On Wednesday, the case of Edison Spine Center v. Aetna Inc. was removed to the New Jersey District Court. The case was originally filed in the Superior Court of New Jersey Law Division for Middlesex County. The complaint alleges deliberate underpa yment of claims by Aetna in a fraudulent manner.
Medical insurance companies contract with medical providers and hospitals to obtain discounted rates from the provider’s standard billing rate for their membership. These discounts are made up for by the volume of patients that will be directed to the medical provider’s practice. However, not every medical provider elects to contract with every insurance plan, especially if the practice is a highly specialized or highly unique in that practice area. The Edison Spine Center has not elected to contract with Aetna and would be considered “Out of network” with no contractual discount rate.
According to the complaint, two surgeons in the practice, Dr. Lombardi and Dr. Patti, performed a medically necessary spinal surgery on an Aetna insured in 2018. The services, totaling $188,440.00 were billed to Aetna for payment. Prior to performing the surgery, the spinal center obtained medical review from Aetna and were authorized to perform the procedure. Aetna reviewed the charges and paid $2984.63, leaving $185455.37 from the original bill, under a theory that this is the amount that is due to out of network providers.
The plaintiffs are suing under three counts: first, for breach of implied contract, arguing that Aetna’s Knowledge of the plaintiff’s out of network status and decision to issue an authorization code anyway created a contract to pay charges as billed; second, for promissory estoppel, arguing that the facility relied upon the authorization code as an agreement that the payment would be fair and reasonable and that a less 2% payment is neither; and third, accounts due. The plaintiffs are represented by Dara J. Lawall. Aetna is represented by Fox Rothschild.