A federal appeals court
dismissed challenges to a $540-million settlement between Cigna
Corp. and thousands of doctors who claimed the health insurer
systematically underpaid them.
The bulk of the nation's doctors, some 700,000, have signed on to a massive
racketeering lawsuit against the managed-care industry, charging the
insurers with breaching contract terms by shortchanging them on payments and
curtailing necessary patient care.
Philadelphia-based Cigna won approval for its settlement in February. But a
small group of doctors disagreed with the settlement and attempted to derail
the deal through the courts.
Cigna said the dismissal of those appeals cleared the way for implementation
of the settlement, which would end Cigna's part in the lawsuits filed by
doctors in the late 1990s.
Under the settlement, Cigna agreed to spend $400 million to improve its
billing systems and pay about $70 million to doctors in addition to $55
million in attorneys' fees.
The insurer also agreed to spend $15 million to create a healthcare
foundation and to establish an advisory committee.
A spokesman for Cigna could not be reached for comment.
Cigna was the second major managed-care company to reach a deal in the
massive lawsuit. Last May, Aetna Inc. and the doctors
settled for $470 million.
A trial for the remaining defendants has been set for June in Miami. They
include Humana Health Plan, PacifiCare Health
Systems, Prudential Insurance Co. of America,
United HealthCare, WellPoint Health Networks
and Foundation Health Systems.
