Aetna’s Prudential Health Care Plan Fined $100,000 for Claims Record

Georgia Insurance Commissioner John Oxendine this week fined Aetna, Inc.’s Prudential Health Plan for reportedly violating Georgia’s prompt pay law, the first health maintenance organization (HMO) to be fined this year for delaying claims payments.

Oxendine ordered the company to pay a penalty of $100,000. The fine is the result of ongoing reviews by the Insurance Department of claims data that health maintenance organizations and other healthcare plans are required to submit quarterly.

“I will continue to monitor our state’s HMOs and fine them if necessary,” Oxendine said. “We’ve seen some improvement in claims handling since I started the initial round of examinations in 1999. Unfortunately, Aetna apparently didn’t get the message. Based on
preliminary results, this company had the worst percentage of non-compliant claims payments among Georgia HMOs. We will continue to monitor all companies for problems of this sort.”

Aetna companies have reportedly been fined four previous times by Oxendine’s office, in 2000 and again in 2002, for a total of $411,200.

Georgia law requires that managed care plans pay a claim within 15
working days, or notify the provider or policyholder the reason why a claim can’t be paid.

In August 1999, Oxendine issued a directive to all healthcare plans licensed in Georgia that his office would begin examining claims data every quarter, beginning with the quarter ending Sept. 30, 1999.

Since then no HMO reviewed to date has reportedly been in 100 percent compliance with the law. HMOs and other healthcare plans have been repeatedly warned by Oxendine that nothing less than strict compliance with the law is expected.