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Doctors take HMO frustrations to court

Two Florida lawsuits are part of a national trend as doctors say health plans are taking too long to pay too little.

Saying health plans are shortchanging them and taking too long to pay claims, Florida physicians have filed two lawsuits against HMOs.

The lawsuits, filed against HIP Health Plan of Florida and United Healthcare of Florida, are the latest in a national trend of doctors and hospitals taking disputes involving payments from managed health care plans to the courts.

Nationally and in Florida, tension is rising between doctors and health plans over the payment of insurance claims.

"Initially, it started coming in as complaints from individual doctors here and there," said Jim Bracher, chief of the bureau of managed care for the Florida Department of Insurance. "And it was not just slow payments but also doctors getting a different payment than they felt they were due. It began to be an issue that was happening with some regularity the latter part of last year."

The rise in complaints from hospitals and physicians prompted a statewide audit of the claims-paying history of Florida's 34 HMOs and last year's passage of a law requiring all claims to be paid within 120 days.

Regulators from the Florida Department of Insurance are now auditing the health plans. Final results are not complete, Bracher said.

The Agency for Health Care Administration also is auditing payment claims involving Medicaid HMO patients, said Kate Morgan, the agency's managed care bureau chief. So far, one HMO has been found in violation of the law and fined. Physicians Healthcare Plans of Tampa will have to pay $13,500 and reprocess all its Medicaid claims, Morgan said.

But the new law's provisions are not strong enough, said Gil Weber, a managed health care consultant in Davie. With no uniform definition of what specific information is required for all claims, he maintains, it is hard for physicians to comply.

"If there's no significant penalty and it's in their financial interest not to pay a claim on time, why should anyone be surprised?" Weber said.

Still, the number of lawsuits filed by Florida doctors is rising. Last month, the Florida Physicians Union of Jacksonville filed a lawsuit in Orlando against United Healthcare of Florida. In its complaint, the 250-member doctors union said a computer program used to evaluate billing accuracies was "downcoding," or changing, the insurance payment code that determines reimbursements so doctors get paid less than they think they are entitled to receive. The complaint alleged that United denied receiving doctors' claims, even those sent by certified mail or hand-delivered.

That lawsuit comes on the heels of another filed in June by West Palm Beach physician Kenneth Mitchell and the Florida Physicians Association against HIP Health Plan of Florida. The HMO denied claims without giving a reasonable written explanation, said claims had been lost or were incomplete when the doctors thought they were not, required legitimate claims to be resubmitted multiple times and failed to take appropriate steps to solve the problem, the lawsuit alleges. HIP has avoided paying "thousands of dollars in claims" to more than 500 doctors, according to the lawsuit, which requests class-action status.

"As far as having a chronic problem, that is not the case," HIP spokeswoman Zandra Faulks said. "It can be caused by problems on the provider's end, with incorrect coding or not sending it to the right person. We are in compliance."

Twenty-six states, including Florida, have laws requiring health plans to pay claims within a certain period, according to the National Conference of State Legislators, with late payers facing possible penalties or fines.

Florida's "prompt-payment law," in effect since October, requires undisputed claims to be paid within 35 days. If more information is needed, the payment request can be kicked back to the medical provider. But, according to the law, the disputed claims must be resolved and paid within 120 days.

Another lawsuit is pending with Prudential Health Care Plan. That lawsuit, filed last year by a group of obstetrician-gynecologists in Duval County, says the insurer said it did not receive numerous claims submitted electronically. A Prudential spokeswoman said nearly 98 percent of its claims are processed within 30 days.