Organized psychology and consumers gained ground in their ongoing push for managed-care accountability when insurer CIGNA agreed to policy changes that should make getting paid for services and conducting other business transactions with the company faster and easier for psychologists. The company also established an $11.5 million settlement fund for payment to a class of psychologists and other nonphysician health-care professionals. These developments were part of the company's recent announcement that it had settled a class action lawsuit filed by nonphysician providers, including psychologists. The plaintiffs alleged that managed-care companies conspired to reduce and delay payments to providers.

The settlement is good news for health professionals and their patients. It increases patient access to providers by allowing providers to spend less time haggling over payment problems and more time focused on patient care. It also calls for prompt updating of provider lists, thereby reducing time that consumers spend calling unavailable providers. And, it gives health professionals a stronger voice in decisions about necessary care for patients.

"The settlement is definitely a step forward--though it doesn't fix the whole managed-care delivery of health services," says Russ Newman, PhD, JD, APA's executive director for professional practice.

Indeed, says JoBeth Halper, of Solana Beach, Calif.-based JoBeth Halper Litigation Group, an attorney for the class and the APA Practice Organization, "The settlement represents a positive change from CIGNA." For example, the settlement will improve psychologists' and consumers' ability to access important information, she said.

The Practice Organization became involved in the litigation and a signatory to the settlement after consulting with Halper about concerns with CIGNA's practices to ensure that the suit adequately addressed behavioral and mental health issues.

As part of the settlement, CIGNA made several commitments:

  • The company will revamp its definition of "medical necessity." Basically, CIGNA will consider important input from professionals and their representative groups, such as from APA and psychologists--in determining whether mental health treatment is medically necessary. "This is a different perspective than most of these managed-care companies are willing to take," says Newman, "and we are hopeful that it will improve patient care by giving greater deference to psychologists' expertise."

  • CIGNA will make much of its policy and procedures transparent. For example, the guidelines for determining medical necessity--as well as the number of medical necessity challenges that go to external review, and the percentage overturned--will be posted online. "While not a panacea, this transparency will help psychologists understand more about decisions the company is making and will offer the potential to better hold the company accountable for its decisions," Newman notes.

  • CIGNA will promptly update its listings of providers in its network, therefore making it easier for consumers to find an available psychologist.

According to CIGNA Chief Clinical Officer W. Allen Schaffer, MD, "This agreement makes it easier for us to work closely with psychologists and other specialty providers to [achieve the best possible medical outcomes], ensure patient safety, and deliver the high-quality care patients need and expect."

In addition to procedural changes, CIGNA will pay $11.55 million to a settlement fund to be allocated among the class members who submit claims by May 27. The class consists of nonphysician providers, including psychologists, who from Jan. 1, 1990, to Dec. 29, 2004, provided services to CIGNA subscribers or subscribers of the dozen other defendants in the case, including Aetna, Humana, Pacificare, Wellpoint, Anthem and United Health. More details on this claims process are available at www.cignaprovidersettlement.com. A simplified explanation of the claims process and a copy of the claim form are available at www.apapractice.org to licensed members of APA who pay the practice assessment. The Practice Organization encourages eligible practitioners to submit claims and share in the settlement fund.

The court gave preliminary approval to the settlement in December. If final approval is granted after a hearing scheduled for late April, it could be appealed--which would delay implementation of significant portions of the settlement, including payment from the settlement fund.

The settlement, says Newman, was brought about by aggressive legal measures. The suit alleges that the companies violated the Racketeer Influenced Corrupt Organization Act (RICO), which was originally created to prosecute organized crime. Use of the RICO statute is relatively new in such class action cases.

At Monitor press time, other involved managed-care companies had not agreed to any settlements with health-care professionals other than medical doctors and dentists. (Aetna has settled its claims with medical doctors and dentists but has not been willing to do so with other health-care providers asserting similar complaints against it). CIGNA's willingness to resolve claims with psychologists and other health-care professionals has sparked a hopeful outlook for many involved.

"We hope that this settlement sets the tone for other defendants in this case to arrive at settlement agreements that make things easier for psychologists and that make mental health care more accessible for patients," says Newman.

The Florida Psychological Association (FPA) recently became a named party in a similar suit against other managed-care companies, including the entire Blue Cross and Blue Shield organization. "FPA's involvement in the litigation represents an important contribution by the psychological associations in ensuring that clinicians can begin again focusing more on patient care than reimbursement problems," Halper says.