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The Beginning of the End?: Cigna Administered Plan Sued for Allegedly Embezzling Plan Assets

Date: Nov 04 2015
Posted by: admin

True View Surgery Center One, L.P. v Chicago Bridge and Iron Medical Plan, Chicago Bridge and Iron Company, and Dennis Fox

Complaint Filed: 10/29/15

Often times, patients receive a letter in the mail from their insurance companies stating that a “discount” was applied to their healthcare provider’s initial charges. While healthcare providers do indeed reduce their charges to  accommodate indigent individuals and individuals who are suffering from exceptional financial circumstances, what many patients don’t realize is that—more often than not—the “discounts” reported to them by insurance companies are never actually authorized by the patients’ healthcare providers. The result is a confusing back and forth dialogue between patients and healthcare providers regarding what exactly the patient owes—which usually inevitably ends up being the “discount” (or more) that the insurance company mentioned in the first place. If you’re reading this and asking yourself “why are insurance companies allowed to do this?” you’re not alone, as a recently filed complaint (True View Surgery Center One L.P. v. Chicago Bridge and Iron Medical Plan, Chicago Bridge and Iron Company, and Dennis Fox)—the subject of this post—shows:

On October 29, 2015, in the Southern District of Texas, True View Surgery Center One L.P. (hereinafter “True View”) filed a complaint that named not only the insurance company (Cigna), but the Plan (Chicago Bridge and Iron Medical Plan), the Plan Administrator (Dennis Fox), and the Employer itself (Chicago Bridge and Iron Company). In the complaint, True View is alleging that Cigna, the Plan, the Plan Administrator, and the Employer (hereinafter “Defendants”) engaged in a scheme to misappropriate the Plan’s funds by doing four things. Namely: (1) Fraudulently processing out-of-network providers’ claims as fake “contractual obligation” claims subject to in-network, PPO pricing, or third party re-pricing agreements; (2) Fraudulently transferring/withdrawing Plan funds under the guise that payments would be issued to the out-of-network providers; (3) Implementing Cigna’s fee-forgiveness protocol scam to wrongfully withhold payments to providers; (4) Falsely denying and withholding valid benefit claims under the flawed premise that the provider first had to prove that the patients’ deductibles and coinsurance amounts were collected in full—even when Cigna instructed healthcare providers not to bill the patients any of the charged amounts and calculated the amounts owed by the patients to be zero; (5) Allowing Cigna to keep, convert, and embezzle the withdrawn Plan funds; and (6) Claiming the amounts that were never paid to the providers as nebulous, ASO managed care, TPA, or other “savings” fees owed to Cigna under its unlawful self-dealing ASO contract.

This complaint lays out many of the arguments that healthcare providers and patients have been verbalizing for decades, yet have fallen on deaf ears. Will True View’s arguments speak louder than the rest? We hope so, and think that True View will definitely get the court’s attention. However, given the number of patients involved, and the number of years the Defendants have been allegedly engaging in this sort of conduct, it is highly likely that the Defendants would not want many people to know of this case. Because of the potential negative publicity that a public trial would garner it’s more likely that the Defendants will settle outside of court—and rather quickly.

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