Georgia health insurers scrutinized over reimbursements

State Insurance Commissioner John Oxendine, joining a national dispute over medical rate-setting, has launched an inquiry into how Georgia health insurers calculate payments to physicians for out-of-network care.

Oxendine has ordered 18 major insurers to report how they set reimbursement rates for service delivered outside their networks. He said he also wants to know which, if any, insurers use the Ingenix database, a focus of lawsuits that allege that data have been manipulated to shortchange patients and doctors. Ingenix is a unit of UnitedHealth Group.

Oxendine said Thursday that insurance companies must pay out-of-network rates to doctors that are considered usual, customary and reasonable for a particular community. “We are getting some complaints,” he said. When doctors are underpaid by insurers, patients often are “balance billed” for the difference, he said.

Last week, the Medical Association of Georgia joined the American Medical Association in filing a class-action lawsuit alleging that WellPoint colluded with Ingenix to underpay physicians for out-of-network services, which, the suit alleged, resulted in patients paying too much on their medical bills.

WellPoint is the parent company of Blue Cross and Blue Shield of Georgia, the state’s largest health insurer.

Similar lawsuits have been filed against Aetna and Cigna. Earlier this year, United said it would pay $350 million to settle an AMA lawsuit over similar issues of price-fixing and the out-of-network claims.

New York’s attorney general has investigated the issue, and a U.S. Senate panel this week questioned United executives about the reimbursement practices.

A spokesman for an insurance industry trade group, America’s Health Insurance Plans, said some doctors charge exorbitant rates to insurers for out of network care. “In many cases, consumers are being stuck in the middle with very high medical bills,” said the spokesman, Robert Zirkelbach.

Kirk McGhee of the Georgia Association of Health Plans said he doesn’t believe that insurers are intentionally underpaying physicians.