Georgia fines Cigna for not paying promptly

A state already aggressive about fining insurers levies its biggest penalty yet for violation of its prompt-payment laws.

By Cheryl Jackson, AMNews staff. Feb. 19, 2001.

Cigna HealthCare of Georgia has to cough up a state-record $300,000 fine for violating prompt-pay laws.

"Cigna's claims handling is the worst that we've seen of any major health carrier in the state," said Insurance Commissioner John W. Oxendine, who, in addition to imposing the Jan. 29 fine, ordered Cigna to develop internal reforms to comply with state law mandating insurers pay a claim within 15 working days or notify the provider or policyholder why it cannot pay.

The fine, which goes to the Georgia treasury, is a result of reviews of claims payment audits for the third quarter of 1999. Cigna also has to pay doctors back with 18% interest.

The state will keep the plan "under very close regulatory oversight," Oxendine said.

"Cigna is a notoriously poor insurer in terms of levels of payments, as well as prompt payment to providers," said Joy Maxey, MD, an Atlanta pediatrician and president of the Medical Assn. of Georgia.

Cigna officials said in a written statement that most of the late payments during that period were due to an inefficient processing system, which the insurer is changing; and that it has since improved claims and interest payments significantly.

Georgia is among the more aggressive states in fining prompt-pay violators. The state has also recently fined Prudential Insurance Co. of America, Aetna U.S. Healthcare, UnitedHealthcare, Blue Cross Blue Shield Assn. and Coventry Health Care Inc. [...]