An ERISA class action suit has been filed against Cigna Health and Life Insurance Co. in Connecticut District Court, alleging the insurer is overcharging for medical services.
Arizona citizen Aubrey Srednicki, the named plaintiff, has a healthcare plan that claims Cigna negotiates lower rates with in-network providers to help those insured with Cigna save money, the complaint said. However, the plaintiffs allege that Cigna has participated in a "fraudulent scheme," that the proposed class members did not save money, and that they were overcharged for medical services.
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The complaint lays out an example in which Srednicki obtained a blood test from an in-network provider, LabCorp, and allegedly discovered the uninsured cash price was significantly less than what she paid. On the Explanation of Benefits, Cigna allegedly said the provider was "HLTH DIAG LAB" instead of the actual provider LabCorp, and the amount billed was $17,462.66.
The cash price for an uninsured customer at LabCorp was allegedly $449.
Cigna claimed on the Explanation of Benefits that it had provided a discount of $14,572.66, and the plan covered $471.02 of the $2,787 covered amount, the complaint said. This left Srednicki with the responsibility to pay $2,315.98 in deductible and coinsurance payments.
Srednicki's doctor allegedly orally confirmed that Cigna had paid in full for the blood test with the $471.02, the complaint said. "Cigna did not disclose to plaintiff Srednicki in its billing materials the fact that LabCorp had been paid in full, nor did it disclose that, in fact, there was no 'balance' to bill plaintiff Srednicki," the complaint said.
In addition, the plaintiffs allege that "'HLTH DIAG LAB' is a doing-business-as pseudonym for Cigna-affiliate Cigna Healthcare of Arizona, Inc.," the complaint said. "These fictitious amounts were then included on a fraudulent invoice, prepared by Cigna Medical Group and sent through interstate mail to plaintiff Srednicki, demanding a fraudulent payment to Cigna Medical Group in the amount of $2,315.98," the complaint said.
The plaintiffs further claim the defendant is a fiduciary of all the class members' plans under the Employee Retirement Income Security Act (ERISA), the complaint said. "Defendant breached the terms of the ERISA plans and legal obligations, committed breaches of fiduciary duty and prohibited transactions, and harmed plaintiff and class members," the complaint said.
A representative for Cigna did not immediately respond to a request for comment. No attorney had entered an appearance for the defense by press time.
Plaintiff counsel Robert A. Izard of Izard, Kindall & Raabe and William H. Narwold of Motley Rice did not respond to a request to comment.
From: BenefitsPRO
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Emily Cousins
I'm a litigation reporter for Connecticut Law Tribune, covering litigation wins, verdict news, settlements, interesting cases, etc. Contact me with tips at [email protected].
