BRIDGEPORT, Conn. (CN) - A lab's fraudulent fee-forgiving scheme cost Cigna and Connecticut General Life Insurance Co. $84 million, the insurers claim in Federal Court.
To "lure" patients from Cigna-administered medical plans, Health Diagnostic Laboratory misrepresents what responsibilities those plans carry, according to the complaint filed Wednesday.
Cigna says the lab promises "not to collect any co-payment, co-insurance or deductible obligation, and ... not to seek reimbursement for any other portion of its bill that the plan does not cover."
One example of the "fee-forgiving" scheme described in the complaint opens with the lab charging Cigna $2,979.
Though Cigna says the patient's cost-sharing responsibilities under the plan are $649.40, the lab "charged the patient nothing."
In fact, the lab allegedly never anticipates collecting any money from the patient.
"By convincing patients that HDL [Health Diagnostic Laboratory] offers services at little or no cost (when, in fact, HDL was artificially increasing the cost of healthcare to Cigna and its clients), HDL increases the volume of its business and, at the same time, increases the harm to Cigna and the plans it serves," the complaint states (parentheses in original).
Cigna says it discovered the billing practices after a special investigation.
"Because no patient is actually paying based on HDL's listed 'charges' to Cigna, patients have no incentive to moderate their demand for HDL's services or to consider the higher costs of any particular out-of-network service, leading to increased costs for the plan," the complaint states. "Similarly, without co-insurance requirements, HDL has no incentive not to charge the plan astronomical rates, because the patients who choose to receive those services would not bear any more of the inflated cost."
Cigna wants to recover the $84 million in overpayments it believes it made to HDL.
Health Diagnostic Laboratory spokesman Jeff Kelley declined Friday to comment on pending litigation. Cigna says the lab should give it only charges that HDL actually charges the plan member as payment in full for HDL's services. It cannot submit charges that include amounts that HDL does not actually require the member to pay, the complaint states, citing as examples "the waiver of any portion of the members' required out-of-network co-insurance, co-payment, and deductible amounts."
Cigna is represented by James Sconzo of Carlton Fields Jorden Burt in Hartford.
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