Aetna, AMA Clash over Medicare Payments

By Anderson, Jane | Clinical Psychiatry News, March 2008 | Go to article overview

Aetna, AMA Clash over Medicare Payments


Anderson, Jane, Clinical Psychiatry News


Aetna Inc. said in January that it is working with the American Medical Association and state medical societies to resolve issues involving nonparticipating physicians after the AMA complained that the insurer was paying those physicians just 125% of Medicare rates and then telling patients they didn't need to pay the rest.

In a letter sent to Aetna, Dr. Michael Maves, AMA's chief executive officer and senior vice president, noted that Aetna's policy--implemented last June--fails to take into account different practice costs that are reflected by physicians' billed charges.

"It is simply arbitrary and capricious for Aetna to deem 125% of Medicare to be a fair payment across the board," Dr. Maves wrote in his letter to Dr. Troyen Brennan, Aetna's chief medical officer.

Dr. Maves also said in the letter that physicians nationwide are reporting receiving Aetna Explanation of Benefits (EOB) forms stating that the patient has no obligation to pay the nonparticipating physician the difference between the physician's charge and the amount Aetna has paid.

This practice, Dr. Maves said, potentially violates the 2003 settlement agreement with Aetna in Multidistrict Litigation 1334, the large class action lawsuit in which physicians sued large managed care companies, including Aetna, over business practices.

However, Dr. Brennan said in an interview that the settlement in that case "clearly differentiates between HMO-based plans and traditional plans." It requires Aetna to tell members in traditional plans that they can be balance-billed by nonparticipating physicians, but it treats HMO plans differently, he said.

HMO members receive an EOB stating that Aetna does not contract with a non-participating provider, and that the provider might not accept Aetna's payment as payment in full for services, Dr. Brennan said. …

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Aetna, AMA Clash over Medicare Payments
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