Dive Brief:
- Aetna Life Insurance has filed suit against North Cypress Medical Center in Texas and its CEO, alleging that the hospital engaged in kickbacks and in deceptive billing practices that caused Aetna to overpay them up to $120 million.
- Aetna's complaint says the medical center's annual gross revenues are above $1.5 billion a year, which it says "is more than twice that of other nearby hospitals that have substantially more patient volume and provide a wider array of medical services."
- The insurer alleges that North Cypress has grossed such such a high amount by paying kickbacks to doctors for providing patient referrals, and by using improper billing techniques.
Dive Insight:
In addition to questioning its revenues, Aetna calls out the hospital for charging "exorbitant fees" to sell consumers on "an upscale five-star hotel-like ambience," Becker's Hospital Review reports.
It may be that hospitals competing on the basis of providing a high-end experience should be especially prepared to justify their costs and revenues.
North Cypress spokeswoman Karen Hinton says the hospital adheres to all federal regulations, and accuses Aetna of suing as part of a "scheme to sue out-of-network providers throughout the nation to coerce them into financially burdensome in-network contracts with Aetna," Becker's reports.