Pomerantz Files Class Action Against Blue Cross Blue Shield Association ("BCBSA") and Related BCBSA Entities

CHICAGO--(Business Wire)--
Pomerantz Haudek Grossman & Gross LLP today announced that it and co-counsel
Buttaci & Leardi, LLC filed a class action lawsuit against the Blue Cross Blue
Shield Association ("BCBSA") and 22 leading BCBS insurers across the country on
behalf of a putative nationwide class of health care providers, as well as the
Pennsylvania Chiropractic Association ("PCA"), the New York Chiropractic Council
(the "Council"), and the Association of New Jersey Chiropractors ("ANJC"). The
suit challenges the Defendants` abusive practices in using post-payment audits
and reviews, and improper repayment demands, to pressure providers to repay
substantial sums that have previously properly been paid as health insurance
benefits for services provided to BCBS subscribers.

The action alleges that the post-payment audit and review process as applied by
the various named BCBS Entities violates the Employee Retirement Income Security
Act of 1974 ("ERISA"), in that its repayment demands are retroactive
determinations that particular services are not covered under the terms of the
BCBS health care plans, but without proper appeal or other protections otherwise
available under ERISA for both self-funded and fully insured health care plans
offered through private employers. The complaint further alleges that the
post-payment audit and review process, as well as the forced withholds of
unrelated benefit payments to offset alleged prior overpayments, violate the
Racketeer Influenced and Corrupt Organizations Act ("RICO").

The PCA, the Council and the ANJC are participating in the action in an
associational capacity on behalf of their members, while fourteen individual
chiropractors and one occupational therapist, located around the country, have
sued as the class representatives of the putative class. According to Gene Veno,
Executive Director of the PCA, "we met on numerous occasions with Blues Senior
Management in an effort to establish a fair and balance approach to conducting
post-payment reviews, but to no avail." As a result, he added, "the PCA elected
to join this action to ensure that the rights of our members are protected."
Four of the 15 named individual plaintiffs are Pennsylvania chiropractors. Dr.
John LaMonica, Chair of the Insurance Committee for the Council, states that
"this action is an important step by the chiropractic profession to fight back
against the egregious actions being taken by Blue Cross Blue Shield companies
against our members and other providers nationwide." The Council and the ANJC
had previously joined in a class action recently filed against Aetna, Inc. for
similar post-payment audit practices.

In the complaint, Plaintiffs allege that, as a means to maximize its profits,
the BCBS Entities use their post-payment audit and review process to make
retroactive adverse benefit determinations whereby they demand that providers
repay funds they had previously received for providing services to BCBS
subscribers. Moreover, the BCBS Entities frequently withhold new benefit
payments for unrelated services to apply toward the alleged overpayments, even
where there has been no valid appeal process or validation that any sums are in
fact owed by the providers. "In essence," says Plaintiffs` counsel Dr. Brian
Hufford of Pomerantz Haudek, "the BCBS Entities simply state there are
overpayments and then just take the money from providers, without valid due
process protections. We believe this is a blatant violation of law."

The Complaint further alleges that the BCBSA is coordinating the recoupment
efforts with its state BCBS licensees on a nationwide basis. Plaintiffs seek to
enjoin the BCBS Entities from continuing to engage in impermissible audit and
recovery practices and to compel them to return the funds they have improperly
withheld.

The amount of funds that are at issue in the lawsuit are substantial. On June
30, 2009, the BCBSA announced that its National Anti-Fraud Department had
"recovered nearly $350 million as a result of the anti-fraud investigations in
2008." Plaintiffs` co-counsel Vincent N. Buttaci of Buttaci & Leardi states that
"we believe a substantial portion of this `recovery` falls within the improper
practices we are challenging in this action."

Pomerantz Haudek, which has offices in New York, Chicago, Washington, D.C.,
Columbus, Ohio and the San Francisco Bay area, is acknowledged as one of the
premier plaintiff class action firms, and, in particular, has been a leader in
the industry in health care class actions on behalf of providers and patients.
Recently, the Pomerantz firm was designated to be Chair of the Plaintiffs`
Executive Committee in a multidistrict litigation pending against Aetna in the
District of New Jersey on behalf of both providers and subscribers, challenging
how Aetna determines usual, customary and reasonable ("UCR") rates for
out-of-network health care services. In making the appointment, the Court
stressed the significant role Pomerantz had played in a $249 million settlement
of its UCR class action against Health Net, stating that the Court had
"similarly appointed Pomerantz to be Plaintiffs` spokesman to the Court in the
Health Net litigation because the Court found D. Brian Hufford, Esq. to be the
attorney most capable of presenting Plaintiffs` position in a clear and concise
manner." In re Aetna UCR Litig., 2009 Dist. LEXIS 66853, *8 n.4 (D.N.J. July 31,
2009).

Founded by the late Abraham L. Pomerantz, known as the dean of the class action
bar, Pomerantz Haudek pioneered the field of securities class actions. Today,
more than 70 years later, Pomerantz Haudek continues in the tradition he
established, fighting for the rights of the victims of fraud, breaches of
fiduciary duty, and corporate misconduct. The Firm has recovered numerous
multimillion-dollar damages awards on behalf of class members.

Buttaci & Leardi, based in Princeton, New Jersey, has a dynamic national health
care practice, representing licensed health care providers, group practices and
other provider-related entities throughout the country. It has extensive
experience representing providers in challenging post-payment audits and
retroactive recoupments, including those pursued by numerous Blue Cross Blue
Shield licensees, and has obtained tremendous success on behalf of its clients.

Counsel for plaintiffs are continuing to investigate these claims, and other
related claims that may be added to the litigation.If you have any questions,
please contact D. Brian Hufford, Esq. of Pomerantz Haudek Grossman & Gross LLP,
by phone (614-410-6501) or email (dbhufford@pomlaw.com), or Vincent N. Buttaci,
Esq., of Buttaci & Leardi, LLC, by phone (609-919-6312) or email
(vnbuttaci@buttacilaw.com).

Pomerantz Haudek Grossman & Gross LLP
Teresa L. Webb, 888-476-6529 / (888) 4.POMLAW
tlwebb@pomlaw.com

Copyright Business Wire 2009