Aetna's olive branch is an encouraging sign

The insurer promises to be more open in communicating with physicians over pay and coverage issues -- an idea the entire industry should follow.

Editorial. July 7, 2003.

Aetna's proposed settlement of a lawsuit regarding its business practices is an encouraging first step for improving the contentious relationship physicians have not only with that company but also with all of managed care.

That is, if Aetna carries through on its promise to be more forthright in its dealings with doctors. The make-love-not-war deal comes after years of Aetna being considered, by many physicians, to be among the worst managed care companies in terms of its treatment of doctors.

Under previous leadership, Aetna was notorious among physicians for being slow to pay but quick to cut reimbursement rates. It was an innovator and aggressive practitioner of so-called "all-products clauses." By forcing physicians to sign up for all of Aetna's offerings -- for example, HMO as well as PPO -- doctors effectively became unwilling participants in steering patients into more restrictive managed care plans. Aetna's strategies were all the more effective -- and resented -- by the sheer marketplace clout that the giant plan possessed.

Origins of this new settlement can be traced to the late 2000 appointment of John Rowe, MD, as Aetna's chair and chief executive officer. He said at the time that improving physician relations was a key to improving profitability. While until now progress has been underwhelming, the settlement agreement could represent a substantial change.