AMA Joins ERISA Class Action Alleging CIGNA Refuses to Honor Discount Contracts

November 21, 2022
Hall Benefits Law, LLC

Plaintiffs filed an amended complaint in a pending ERISA class action lawsuit to include state law claims by the American Medical Association (AMA), the Medical Society of New Jersey, and the Washington State Medical Association. The original individual plaintiffs were participants in CIGNA-administered health plans and received medical care from physicians in the MultiPlan network. 

Physicians in the MultiPlan network agree not to hold patients liable for the difference between the billed charges and the discounted rate under the network. They allege that CIGNA often refuses to honor the billed charges and pays physicians at a discounted rate to which they had not agreed. In other words, they claim that CIGNA intentionally underpaid the insurance claims. The case is Stewart v. CIGNA, Case No. 3:2022cv00769 (U.S. District Court for the District of Connecticut). 

The AMA and other professional medical groups who have joined the suit claim that CIGNA has engaged in misconduct by shortchanging payments to MultiPlan physicians after they treat patients covered by the plan. They also allege that CIGNA has interfered with the patient-physician relationship by ignoring the MultiPlan contracts. CIGNA also reportedly advised patients that they were liable for the portion of the billed charges that CIGNA did not cover by sending them incorrect Explanations of Benefits (EOBs) concerning their claims. The groups claim that CIGNA’s actions amount to deceptive business practices. 

HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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