The American Medical Association has joined plaintiffs in a class-action lawsuit against Cigna, alleging that the payer engaged in misconduct by underpaying provider claims in its MultiPlan network.
Other medical groups, including the Medical Society of New Jersey and Washington State Medical Association, have also joined the plaintiffs.
The lawsuit, which was filed in a Connecticut District Court, claims that Cigna reimbursed MultiPlan providers at its non-participating provider rate, rather than the participating provider rate, leaving clients “exposed to the threat of balance billing” and ultimately underpaying claims.
Balance billing is when providers bill patients for the cash difference between original charges billed and discounted rates, something that MultiPlan providers are prohibited from doing in their contracts with the network, according to the suit.
The No Surprises Act, which went into effect in January, outlaws balanced billing and is meant to protect patients from receiving out-of-network bills from care they received at in-network facilities. However, one in five Americans reported receiving surprise bills this year, despite the NSA going into effect.
Cigna is a client of MultiPlan, the country’s largest “third-party network” company, which allows Cigna to contract with MultiPlan providers. MultiPlan has contracts with over 1.2 million providers, according to the suit.
Cigna “breached its fiduciary duties, including its duty to honor written plan terms and its duty of loyalty, because its conduct serves Cigna’s own economic self-interest and elevates Cigna's interests above the interests of plan member patients,” according to the lawsuit, filed on June 10.
Jack Resneck, president of the AMA, said that the insurer has allowed its “economic self-interest to be prioritized ahead of their promises to physicians in the Multiplan Network and their patients.”
“Patients and physicians have a right to expect health insurers to uphold their promise to provide fair and accurate payment for medical services,” Resneck said in a statement. “By joining Stewart v. Cigna as a plaintiff, the AMA hopes to shed light on Cigna’s misconduct and create remedies so that patients and physicians can look forward to getting what they are promised.”
Cigna did not respond to a request for comment.