Cigna and American Specialty Health Agree to Pay $11.8 in Settlement with Chiropractic Care Centers
Cigna and American Specialty Health Inc. have agreed to an $11.8 million settlement that will resolve litigation with a proposed class of chiropractic care centers whose patients were denied claims. The settlement is subject to approval by the Pennsylvania federal judge overseeing the case. One of the primary attorneys for the chiropractic centers is Brian Hufford, who represents the ICS in two pending class actions.
One of the allegations in the case was that ASH’s utilization management policies violate the Employee Retirement Income Security Act of 1974 (ERISA) as applied to chiropractic. ASH imposes a pre-authorization requirement after the first 26 visits, which violates the terms of the underlying employee health plans. The chiropractic centers filed a motion asking the judge to approve the agreement that requires American Specialty Health and Cigna to pay monetary compensation for claim denials and to make other changes to its business.
According to the motion, the nearly $11.8 million settlement amount equals a substantial portion of what the centers would have received had Cigna approved and paid in full the claims that are the subject of the litigation. American Specialty Health also agreed to make certain business reforms, including adding more chiropractic associations or out-of-network providers to its Professional Affairs Health Advisory Committee and offering more free continuing education to providers. According to Mr. Hufford, the American Chiropractic Association now has a representative on the ASH Committee, on which the Illinois Chiropractic Society has had a representative for several years.
American Specialty Health and Cigna have denied the allegations of the complaint and declined to comment on the settlement agreement. However, this resolution, if approved by the court, provides some compensation for ASH’s failure to follow the terms of the affected patients’ health plans.