New York Fines 20 Health Insurers Nearly $717,000 for Violations of Prompt-Payment Law

New York insurance regulators have fined 20 health insurers and health maintenance organizations nearly $717,000 combined for not paying members' and providers' insurance claims promptly.

UnitedHealthcare was fined $159,650. The department fined Affinity Health Plan $154,000. Attempts to speak with either company were unsuccessful. Group Health Inc. was fined $68,500. A spokeswoman for GHI declined comment.

By agreeing to pay the fines, the companies acknowledged that they didn't pay certain claims within the state-mandated time frame, the department said.

The prompt payment law, which took effect in 1998, requires health insurers and HMOs to pay undisputed insurance claims within 45 days of receiving them, the New York State Insurance Department said.

Insurers and HMOs have paid the state $9.1 million in prompt-pay fines since 1998 when the law became effective.

The other companies fined were: Cigna, a unit of Cigna Corp (NYSE: CI), $57,750; HIP, $54,500; Amerigroup, $43,500; Empire, a unit of WellPoint (NYSE: WLP), $31,500; Oxford, a unit of UnitedHealth, $31,100; Aetna, a unit of Aetna Inc. (NYSE: AET), $25,100; HealthFirst, $24,900; Health Net, a unit of Health Net Inc. (NYSE: HNT), $13,600; HealthPlus, $9,600; NY-Presbyterian, $9,600; WellCare, a unit of WellCare Health Plans (NYSE: WCG), $9,000; Excellus, a Blue Cross Blue Shield company, $8,000; Fidelis, $7,200; Guardian, $2,600; GHI HMO, $2,400; and Neighborhood Health, $1,000.

In 2007, UnitedHealthcare reached an agreement with 36 states and the District of Columbia over claims-processing problems. Under the settlement, the company was to pay at least $12 million to the 37 jurisdictions to settle all matters and to reimburse them for the costs associated with a multistate analysis of its commercial health plans (BestWire, Sept. 7, 2007).

UnitedHealthcare Insurance Co. currently has a Best's Financial Strength Rating of A (Excellent).

(By Fran Matso Lysiak, senior associate editor, BestWeek: [email protected])