New Jersey doctors sue insurer over forced payback

Analysts say health plans are getting more aggressive in demanding repayments from physicians.

By Robert Kazel, AMNews staff. Jan. 3/10, 2005.

In November 2004, a letter arrived at The Heart Group, a seven-physician cardiology practice in Millburn, N.J. In the letter, Horizon Blue Cross Blue Shield of New Jersey said it overpaid the group $189,000 for cardiac catheterizations over the course of 20 months. The doctors were asked to remit that amount by check, using an enclosed envelope, or work out an extended repayment arrangement.

Angered, the physicians felt they owed Horizon nothing, said Fred Aueron, MD, a cardiologist with the group. For several years Horizon had been paying the group $1,700 for the procedure, he said. Now the company said those fees should have been about $350 per catheterization. A computer programming mistake, the insurer said, was to blame.

The physicians told Horizon they wouldn't pay. "We said, 'This has been our fee going back to the mid-'90s or as far back as [we] could track it,' " Dr. Aueron said. "I don't believe for one moment they have that poor a computer system [that] they don't know their payment schedules for various practitioners."

That mistrust was shared by many cardiologists across New Jersey who received similar overpayment notices at about the same time. In all, Horizon notified about 600 cardiologists in 273 practices that they collectively owed $15 million in connection with flawed calculation of fees for catheterizations. If repayment was not made within weeks, Horizon told some groups, it would recoup the contested funds against future reimbursements.