CMA claims that Aetna's actions violated the state's Unfair Competition Law.
The California Supreme Court has granted a California Medical Association request to review a decade-long lawsuit against Aetna challenging the health insurer's denials of out-of-network benefits.
The story begins in July 2012, when CMA, the Los Angeles County Medical Association, and other providers sued Aetna for what the plaintiffs alleged was "a systematic practice by Aetna of harassing and terminating contracted physicians from the Aetna network when they refer patients to out-of-network ambulatory surgery centers."
Fast-forward to November 2019, and after seven years of mind-numbing litigation, the Los Angeles Superior Court ruled that CMA did not have legal standing to pursue claims against Aetna on behalf of its physician members.
However, CMA has argued that the Los Angeles appellate court wrongly concluded that CMA's use of its own money didn't count as injury to the organization because CMA "was founded to advocate on behalf of its physician members" and that CMA staff time spent fighting these abuses "was typical of the support CMA provides its members in furtherance of CMA's mission."
CMA claims that Aetna's actions violated the state's Unfair Competition Law, which grants standing to any person or organization that "has suffered injury in fact and has lost money or property as a result of the unfair competition."
"Aetna's practices at issue in this case both harmed CMA and its members and frustrated the other more expansive purposes of the organization, as CMA was forced to expend resources and money in order to protect its members from Aetna's unfair practices," CMA said in a media release. "That is all that is required to establish standing under the UCL."
"If the appellate court's decision is allowed to stand, it would effectively preclude any membership organization from ever seeking relief under the UCL and undercut a central plank of private enforcement of one of the state's most important consumer-protection laws," CMA said.
CMA is calling the decision to hear the petition "a major victory" because the state's highest court reviews only about 3% of the more than 1,000 civil petitions for review it gets each year.
“Aetna's practices at issue in this case both harmed CMA and its members and frustrated the other more expansive purposes of the organization, as CMA was forced to expend resources and money in order to protect its members from Aetna's unfair practices.”
California Medical Association
John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.
KEY TAKEAWAYS
CMA has argued that a state appellate court wrongly concluded that CMA's use of its own money didn't count as injury to the organization.
The state's Unfair Competition Law grants standing to any organization that "has suffered injury in fact and has lost money or property as a result of the unfair competition."
CMA is calling the decision to hear the petition "a major victory" because the state's highest court reviews only about 3% of the more than 1,000 civil petitions for review it gets each year.