NJ Pounds UnitedHealthcare With $2.5M Fine, Biggest In 9 Years

New Jersey regulators fined UnitedHealthcare $2.5 million for using a provider of hemophilia services that wasn't approved by the state, officials for the Department of Banking and Insurance said.

The department also fined Aetna $350,000 for issuing new policies even though it was withdrawing from the market, it said.

"These actions should send a clear message that the department takes very seriously its mission to ensure that New Jersey residents are protected and regulated entities are operating in compliance with the law," Department of Banking and Insurance Commissioner Marlene Caride said in a statement.

UnitedHealthcare has about 75,000 customers in New Jersey through its Oxford Health affiliates, mainly through plans sold to small employers. Aetna and its affiliates before leaving covered about 42,000 New Jerseyans, also through small employer plans, according to state data.

The fines were part of a total of $12.5 million in penalties levied by the state banking and insurance department in the first half of the year.

UnitedHealthcare, which has about 18 percent of the small employer market, faced the biggest fine issued by the department in nine years.

The department said it received complaints from some of the insurer's customers about service to treat hemophilia, a condition that impairs blood clotting. It found the insurer used a provider for nine months last year that wasn't approved by the state.

The insurer said one of its companies acquired the provider in July 2015 and attributed it to an administrative oversight. It stopped using the provider last September, according to the consent order.

"We worked closely with the New Jersey Department of Banking and Insurance to address its concerns and made improvements where needed," UnitedHealthcare said in a statement.

Aetna had about 11 percent of the small employer market before it left the state.

The carrier issued 335 new small employer health plans after notifying the department that it was withdrawing, the department said.

Insurers are required to stop issuing new policies within two months of announcing their decision to leave. Regulators detected the violation after Aetna filed its required enrollment reports, the department said.

Aetna's customers will continue to be covered by the company until their policies end, the department said.

Aetna declined to comment.

Michael L. Diamond; @mdiamondapp; 732-643-4038; [email protected]

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