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Analysis

California Fines Aetna $500K for Wrongful Denial of EMS Claims

By John Commins  
   August 28, 2020

Aetna says it is working to correct the problem and is cooperating with state insurance regulators.

California insurance regulators this week slapped a $500,000 fine on Aetna Health of California, Inc. for "repeatedly failing" to pay beneficiaries' claims under the state's broader emergency room coverage standards.

"The plan’s failure to follow California law for reimbursing emergency room claims is unacceptable," said Mary Watanabe, acting director of the California Department of Managed Health.

Walnut Creek-based Aetna Health of California was also ordered to stop using the plan's national standard to deny emergency room claims.

"This has resulted in Aetna wrongfully denying emergency room claims," Watanabe said. "Aetna must follow the state's healthcare laws to ensure enrollees have access to the care they need."

Aetna issued a statement saying it is working to correct the problem and is cooperating with CDMC.

California law requires a health plan to pay for emergency medical services unless it can show that either the services were never performed or the enrollee did not require them and should have known so.   

Aetna of California has had previous run-ins with CDMH over emergency medical services payments in 2015 and 2016 and paid $135,000 in fines. Aetna also agreed to Corrective Action Plans requiring training for employees handling claims for emergency services and reimbursement for emergency services based on the California standard.

"Despite the enforcement actions taken against the plan to correct its deficiencies, the DMHC Help Center received four complaints in 2018 and 2019 showing that the plan had wrongfully denied emergency room claims based on the incorrect standard," DMHC said.

DMHC reviewed a sample of Aetna's denials of emergency medical services and in 2019 concluded that 93% of the sampled claims were wrongfully denied.

DMHC also reviewed Aetna's commercial emergency medical services denial template for HMOs and determined that the templates did not follow California law.  

Aetna Responds

Aetna of California issued this statement in response to the settlement.

"We are committed to providing our members with appropriate access to emergency room services and to complying with all laws applicable to our business.  For medical emergencies, our members should utilize the nearest emergency room facility.

"We have taken a number of steps to help ensure that we handle emergency room claims consistent with California’s standard for determining whether an emergency medical condition exists. We are cooperating with the California Department of Managed Health Care in this matter."

“The plan’s failure to follow California law for reimbursing emergency room claims is unacceptable.”

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.


KEY TAKEAWAYS

DMHC reviewed a sample of Aetna's denials of emergency medical services and in 2019 concluded that 93% of the sampled claims were wrongfully denied.

Walnut Creek-based Aetna Health of California was also ordered to stop using the plan's national standard to deny emergency room claims.

Aetna of California has had previous run-ins with CDMH over emergency medical services payments in 2015 and 2016 and paid $135,000 in fines.


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