Court Permits Provider ERISA Class Action to Proceed Against Blue Cross Blue Shield Companies for Improper Overpayment Demands and Forced Recoupment
The action alleges that BCBS’ post-payment audit and review process violates ERISA. Plaintiffs allege that BCBS’ repayment demands are retroactive determinations that particular services are not covered under the terms of the BCBS health care plans, but without proper appeal or other protections otherwise available under ERISA for both self-funded and fully insured health care plans offered through private employers. According to Plaintiffs’ counsel D. Brian Hufford of the Pomerantz Firm, “this decision is a critical first step in this litigation, as it recognizes the validity of our underlying claims under ERISA and now allows us to proceed to the real work of the case – to obtain the discovery necessary to prove our contention that the various BCBS entities have improperly taken millions of dollars from providers nationwide.”
The Court also upheld association plaintiffs’ right to pursue injunctive remedies in a representational capacity on behalf of their members. The Court permitted the individual plaintiffs’ claims to go forward even though some had settled with BCBS, noting that these plaintiffs had alleged “that they did so under duress because they were not able to effectively appeal due to defendants’ improper actions.”
Although the court dismissed the claims under the Racketeer Influenced and Corrupt Organizations Act (“RICO”), plaintiffs intend to serve an amended complaint. Co-counsel Vincent Buttaci of Buttaci & Leardi LLC states: “We currently intend to seek leave to replead the RICO allegations. We strongly believe that we have the necessary facts to satisfy the RICO pleading requirements as outlined by the Court.”
In another ruling, the Court found that six of the 18 individual plaintiffs had arbitration clauses in their in-network provider agreements, which required them to arbitrate their claims rather than pursue relief through the courts. Similarly, the Court found that that California Chiropractic Association should pursue claims through arbitration, since defendants showed that their standard practice was to use arbitration clauses in California. Significantly, however, the Court concluded that the litigation should not be stayed.
The amount at issue in the lawsuit is substantial. On June 30, 2009, the Blue Cross Blue Shield Association, “a national federation of . . . Blue Cross and Blue Shield companies,” announced that its National Anti-Fraud Department had “recovered nearly $350 million as a result of the anti-fraud investigations in 2008.” Plaintiffs believe that a significant portion of this “recovery” falls within the improper practices that are being challenged in the lawsuit, and should be repaid to providers. Pomerantz Haudek and Buttaci & Leardi have brought a similar class action challenging improper post-payment audits and repayment demands against Aetna, and are investigating comparable claims against other insurers.
“This is a landmark decision, with widespread implications for the health care industry,” says Jin Zhou, D.C. “Providers finally have a means to fight back against insurance companies for making invalid overpayment demands.” Dr. Zhou is a national ERISA consultant who, through his website, www.ERISAclaim.com, and consulting services he offers to providers and plan sponsors, has long advocated the use of ERISA to combat improper post-payment audit activities.
The Pomerantz Firm, with offices in New York, Chicago, Washington, D.C., Columbus, Ohio and the San Francisco Bay area, is acknowledged as one of the premier plaintiff class action firms, and, in particular, has been a leader in the industry in health care class actions on behalf of providers and patients. Recently, the Pomerantz Firm was designated to be Chair of the Plaintiffs’ Executive Committee in a multidistrict litigation pending against Aetna in the District of New Jersey on behalf of both providers and subscribers, challenging how Aetna determines usual, customary and reasonable (“UCR”) rates for out-of-network health care services. In making the appointment, the Court stressed the significant role Pomerantz Haudek had played in a $249 million settlement of its UCR class action against Health Net, stating that the Court had “similarly appointed Pomerantz to be Plaintiffs’ spokesman to the Court in the Health Net litigation because the Court found Mr. Hufford to be the attorney most capable of presenting Plaintiffs’ position in a clear and concise manner.” The Pomerantz Firm has also obtained preliminary approval of a $350 million settlement with United Health Group on similar UCR issues.
Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of victims of fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members.
Buttaci & Leardi, based in Princeton, New Jersey, has a dynamic national health care practice, representing licensed health care providers, group practices and other provider-related entities throughout the country. It has extensive experience representing providers in challenging post-payment audits and retroactive recoupments, including those pursued by numerous Blue Cross Blue Shield licensees, and has obtained tremendous success on behalf of its clients.
Counsel for plaintiffs are continuing to investigate these claims, and other related claims that may be added to the litigation. If you have any questions, please contact D. Brian Hufford, Esq. of Pomerantz Haudek Grossman & Gross LLP, by phone (212-661-1100) or email (dbhufford@pomlaw.com), or Vincent N. Buttaci, Esq., of Buttaci & Leardi, LLC, by phone (609-799-5150) or email (vnbuttaci@buttacilaw.com).
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COUNCIL AND NYSCA CO-HOST SUCCESSFUL FUNDRAISER FOR NYS ATTORNEY GENERAL ANDREW CUOMO
On Wednesday, March 9th, the New York State Chiropractic Association and the New York Chiropractic Council held a joint fundraising event for New York State Attorney General Andrew Cuomo at a midtown Manhattan restaurant, attended by 50 doctors of chiropractic. Dr. Jack Beige introduced Attorney General Cuomo, citing the long working relationship and friendship he has shared with the Cuomo family since they began their involvement in New York politics.
At the event, Mr. Cuomo demonstrated a clear understanding of the chiropractic profession’s challenges, as well as first-hand appreciation of the benefits of chiropractic care. He noted that he and his father, former Governor Mario Cuomo, benefit regularly from chiropractic treatment. Mr. Cuomo also stated that he knows firsthand of the power and abuses of the insurance industry and that he has successfully challenged these abuses. As a prime example, Attorney General Cuomo mentioned his recent success in investigating Ingenix Inc., the nation’s largest provider of health care billing information, where his office uncovered a defective and manipulative database that many insurance providers relied on to determine “reasonable and customary” rates for out-of-network medical expense reimbursement, as but one example. Mr. Cuomo went on to discuss the greater political and governmental challenges we currently face in New York, and how strong executive leadership is essential if we are to remain the Empire State.
The question and answer period during the fundraiser was productive as well. Dr. Tom Ventiamiglia, Clinical Director of New York Chiropractic College, emphasized that natural, cost-effective chiropractic care deserved a more prominent role in our healthcare system. Other doctors raised additional, important issues before the Attorney General, such as unfairly high co-pays and the continuing problem of onerous peer review, to name but a few.
All in all, the evening was a fundraising success to benefit Attorney General Andrew Cuomo, a likely candidate for governor this year. The event also represented yet another example of the Council and NYSCA’s increasing professional cooperation, as well as an example of Council’s effective and proactive participation in the political process for the benefit of all practicing doctors of chiropractic in New York.
Respectfully submitted by Kenneth P. Gonoud, D.C.
Vice President, New York Chiropractic Council
Medicare Alert
The Centers for Medicare & Medicaid Services (CMS) has become aware of a scam where perpetrators are sending faxes to physician offices posing as the Medicare carrier or Medicare Administrative Contractor (MAC). The fax instructs physician staff to respond to a questionnaire to provide an account information update within 48 hours in order to prevent a gap in Medicare payments. The fax may have the CMS logo and/or the contractor logo to enhance the appearance of authenticity. It is the Medicare Hotline to report this scam-1-800-hhs-tips (447-8477).
Survey of complementary and alternative therapies used by children with specific learning difficulties (dyslexia).
School of Life Sciences, Roehampton University, London, UK. leona@mail.com
BACKGROUND: Dyslexia is a common learning difficulty affecting up to 10% of British children that is associated with a wide range of cognitive, emotional and physical symptoms. In the absence of effective conventional treatment, it is likely that parents will seek complementary and alternative medicine (CAM) to try and help their children. However, little is known about the level of CAM use or the type of CAM used by dyslexic children. AIMS: This study assessed: (1) the lifetime use of CAM by dyslexic children, (2) the role of socio-demographic factors in CAM use by dyslexic children, (3) parental attitudes towards CAM use in the treatment of dyslexia, and (4) how parents' understanding of dyslexia affects CAM use. METHODS & PROCEDURES: A semi-structured questionnaire-based survey of parents of 148 dyslexic school children was undertaken. The children had been recruited to a university research programme investigating the effectiveness of a complementary therapy for the treatment of learning difficulties. OUTCOMES & RESULTS: Lifetime use of CAM was 55.4% (82 children). The most popular CAM approaches were nutritional supplements/special diets (63 children) followed by homeopathy (29 children) and osteopathy/chiropractic manipulation (29 children). Socio-demographic factors did not predict CAM use. In total, parents of 101 dyslexic children reported that an interest in CAM for the treatment of dyslexia was based on their preference for CAM for their families more generally. Parents who thought that dyslexia was a 'medical/health' disorder were more likely to have used CAM with their children (p<0.01) than other parents in this survey. CONCLUSIONS & IMPLICATIONS: Educational and health professionals should be aware that many dyslexic children use CAM. Parents of dyslexic children should be provided with evidence-based advice to help them make informed therapeutic choices.
PMID: 18608596 [PubMed - in process]
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A special chiropractic adjustment can significantly lower high blood pressure, a placebo-controlled study suggests.
01/25/2008 02:12 PM |
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New York, NY (September 11, 2009) – The NY Chiropractic Council (the “Council”) as well as the Pennsylvania Chiropractic Association (“PCA”), the Association of New Jersey Chiropractors (“ANJC”), fourteen individual chiropractors and one occupational therapist, located around the country, have sued as the class representatives of the putative class.
11/06/2009 09:50 AM |