Health insurer Group Health Inc. (“GHI”) must send reimbursement checks expected to approach $500,000 and change its claims handling practices to settle charges brought by the New York Attorney General Eric T. Schneiderman  that its mishandling of certain out-of-network claims wrongfully denied coverage to its members.  Schneiderman charted that GHI violated New York law by processing claims and caused patients to be billed wrongfully for covered physician services — sometimes in amounts reaching thousands of dollars — when they should have been shielded from any expense by applying standard out-patient coverage schedules even though the GHI health insurance policy was required to cover certain key medical providers who might be out-of-network — including anesthesiologists, pathologists, and radiologists — at a higher rate and with no member cost-share.

Under the terms of the agreement with GHI, the insurance company will send reimbursement checks to affected members. Because of the Attorney General’s investigation, GHI has already returned $162,000 to New York consumers and that number is expected to approach $500,000 in restitution for three years of claims. GHI will retain an auditor to ensure all eligible members are given refunds. In addition to providing reimbursement to eligible members, the agreement provides that GHI train its employees, pay a penalty, and assist consumers with resolving any debt collection activity.  See here.

GHI is part of Emblem Health, and provides insurance to consumers to 28 counties across New York State.

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