Kaiser, Group Health Incorporated pay multi-million dollar penalties


Certain top-name insurers are in the spotlight for having to pay some hefty penalties.

Take for instance the latest case with Kaiser Permanente. Kaiser agreed to dish out $4 million after an 18-month back-and-forth with California's overseer of managed healthcare, reports the Sacramento Bee.

The dispute stems from allegations that Kaiser blocked patients from receiving timely mental health care.

According to a March 2013 report, issued by the state's Department of Managed Health Care, the healthcare mogul subjected patients to long wait lists to see mental health professionals and provided these patients with "inaccurate educational materials" as a way to discourage them from seeking immediate care, notes the article.

In response to the allegations, Kaiser released a public statement, announcing their plans "to improve the experience of our members, patients and purchasers in the area of mental healthcare." What's more, Kaiser hopes to offer "better engagement with patients to create treatment plans with them, so that the goals of their treatment are well defined and understood."

Kaiser is not the only one facing accusations. 

After New York-based Group Health Incorporated (GHI), a subsidiary of EmblemHealth, was found to be providing its members with inadequate information regarding their Comprehensive Benefits Plan, GHI agreed to fund a $3.5 million consumer assistance program to provide its members with financial aid, according to the investigation conducted by Eric T. Schneiderman, Attorney General of New York.

In his report, Schneiderman notes that GHI reimburses its members for out-of-network providers, based on a payment rate, but if the fees exceed the standards based on the rate, the member must make up the difference.

And according to the investigation, GHI did not inform its members of low reimbursement rates, and neglected to alert them of costly medical bills they could incur from receiving care outside their network.

"By improving communications describing the out-of-network benefit, GHI is committing to helping members and prospective members make important decisions concerning their health care coverage and treatment," Schneiderman announced, with regards to GHI's assistance program, according to PressZoom.

In July, consumer Watchdog hit California's Anthem Blue Cross with a class-action lawsuit for allegedly misleading millions of members about whether physicians and hospitals were participating in new plan networks, as FierceHealthPayer previously reported. Anthem declined to comment on the lawsuit at the time, but said it would pay the claims of members received treatment from incorrectly listed doctors during the first three months of the year. 

For more:
- here's the Sacramento Bee article
- here's Kaiser's public statement
- read the PressZoom announcement
- check out New York's Attorney General report (.pdf)

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