Aetna reaches $120 million settlement over reimbursements
(Reuters) - Aetna Inc (AET.N), the third-largest U.S. health insurer, has agreed to pay as much as $120 million to settle nationwide litigation over how it pays claims for services by out-of-network providers.
The accord calls for Aetna to pay $60 million into a general settlement fund, plus as much as $60 million more depending on how many people submit claims.
Aetna said it will take a $78 million after-tax charge in the current quarter for the settlement, and that the charge will not affect operating earnings. It expects to pay for the settlement over the next one to two years.
The settlement requires approval by U.S. District Judge Stanley Chesler in Newark, New Jersey.
According to a court filing, the plaintiffs said Aetna improperly used databases provided by Ingenix Inc to systematically underpay claims involving services and supplies provided to members by out-of-network providers.
The litigation also challenged other methods by which the Hartford, Connecticut-based insurer calculated out-of-network reimbursement rates, as well as its disclosures for how it calculated those rates.
Shares of Aetna closed Thursday at $43.43 on the New York Stock Exchange.
The case is In re: Aetna UCR Litigation, U.S. District Court, District of New Jersey, Nos. MDL-2020 and 07-03541.
(Reporting by Jonathan Stempel in New York; Editing by Gerald E. McCormick and Sofina Mirza-Reid)