Empire Blue Cross Blue Shield Sued for Out-of-Network Bill Underpayment

On Tuesday, Surgical Specialists of Greater New York, on behalf of a patient, filed a complaint in the Southern District of New York against Empire Blue Cross Blue Shield (BCBS) for the purported drastic underpayment of bills submitted. The plaintiffs allege that BCBS did this due to the Specialists out-of-network status, despite the services being performed in urgent, unplanned circumstances.

The patient underwent surgical treatment at Lenox Hill Hospital for advanced deeply infiltrative stage four endometriosis, according to the complaint. The complaint stated the patient had previously attempted to surgically correct this issue, but the treatment failed and this procedure was an attempt to correct this life-threatening condition.

During the procedure, it became apparent that the infiltrations had reached the patient’s colorectal area and an emergency consult was sought. The patient remained under anesthesia and had no choice in provider or opportunity to seek pre-authorization with BCBS. Accordingly, it was determined that due to the patient’s condition, the risks of further anesthesia, the risks of bleeding and infection, and other risks that the Specialists surgeons would first investigate, and then, if possible, treat the infiltrations.

This resulted in a successfully performed procedure and bills totalling $229,084.24, as noted in the complaint. BCBS only remitted payment in the amount of $6,399.80, a payment of less than three percent of the billed charges. The plaintiffs asserted that BCBS indicated that this lower payment was due to the bundling or combining of certain charges, denial of certain charges as being covered by the main endometriosis procedure, and a direct underpayment of the codes billed according to industry standards.

The plaintiffs are suing for recovery of benefits and breach of fiduciary duty for the BCBS ERISA plan. The plaintiffs seek payment of the full charges. The plaintiffs are represented by Stein Adler Dabah & Zlekowitz LLP and Drachman Katz LLP. No counsel has been entered for the defendant.