During the ongoing COVID-19 pandemic, there has been an increased emphasis on health and health insurance as millions have become infected with the virus, hundreds of thousands of have died, and hospital beds fill.
COVID-19 related health insurance litigation has already begun; for example, a testing company sued Cigna for refusing to pay for the testing of COVID-19 specimens. However, litigation involving health insurance companies extends beyond COVID-19 for issues such as failing to cover certain treatments.
Furthermore, most health insurance companies have arbitration provisions, making it challenging to track the total volume of disputes between the insured and their respective insurance companies. Some members of Congress are seeking to change that. In June 2021, Reps Katie Porter (D- Calif.), Lloyd Doggett (D-Texas), Jan Schakowsky (D-Ill.) and Rosa DeLauro (D-Conn.) introduced legislation entitled the Justice for Patients Act, which would allow patients to sue insurance companies in federal court and join class-action lawsuits.
The following is an analysis of federal court lawsuits against several major health insurance companies in district courts from January 2020 to September 15, 2021.
Aetna, which has approximately 39 million subscribers according to its website, has faced a variety of litigation. For example, most recently Aetna was sued by a health care company regarding payment and it was sued over LGBTQ subscribers’ fertility treatment access, as well as for denying “experimental” cancer treatment and denying mental health coverage.
From January 2020 to September 15, 2021, Aetna and its related entities have been involved in 438 lawsuits in federal court, peaking in February 2020 at 36 filings. For the most part, there have consistently been 15 – 25 filings per month during this time period. In comparison to the previous three months, litigation with Aetna is 30% lower.
The five courts where these cases most commonly appear are the Southern District of Florida, the District of Minnesota, the Middle District of Florida, the District of New Jersey, and the District of Utah.
The most common case types for litigation against Aetna were employee retirement and ERISA at 286 each; this case type often includes healthcare insurance disputes. 72 were for insurance (e.g. breach of insurance contract, tort claim, or other cause relating to an insurance contract).
Taking a look specifically at Aetna Life Insurance Company, Aetna is the defendant in the vast majority of the litigation it is involved in. Specifically, Aetna Life Insurance Company is the defendant in 97% of its litigation.
In these suits, Aetna is represented by a variety of law firms. In particular, Shutts & Bowen LLP is the dominant law firm in both 2020 and 2021. Chittenden, Murday & Novotny LLC has increased its representation from 2020 to 2021 with litigation focused on ERISA. Meanwhile, Fox Rothschild LLP as well as Gordon Rees Scully Mansukhani, LLP and Womble Bond Dickinson (US) LLP had fairly consistent representation in both 2020 and 2021. Connell Foley and Fabian VanCott representation has slightly decreased from 2020 to 2021. However, Ogletree, Deakins, Nash, Smoak & Stewart P.C., which represented the company in 2020, has yet to represent Aetna in 2021. The six out of the seven lawsuits the law firm represented Aetna in were ERISA related, while one was related to insurance contracts.
Recently, Law Street Media has covered Cigna being sued in August for reportedly wrongly bundling charges to obtain higher discounts. In September, a neurosurgeon sued Cigna for denying benefits to a patient. Meanwhile, in April, Cigna argued that a medical provider overcharged patients in a motion to dismiss a lawsuit brought against the insurance company for failing to reimburse the providers for COVID-19 testing. In October, Cigna announced that it is divesting some of its assets to Chubb in a $5.75 billion deal.
From January 2020 to September 15, 2021, Cigna has been involved in 315 federal lawsuits, 40 of which were filed in the last three months. Like Aetna, federal litigation is down 31% over the past three months. Litigation peaked in December 2020, but dipped by February 2021. On average, the number of lawsuits filed in a month hovers around 15.
Lawsuits are most frequently filed in the District of New Jersey by a large margin, after which they are filed in the District of Utah, the Central District of California, the Southern District of Florida, and the Middle District of Florida most frequently.
Looking at Cigna Health and Life Insurance specifically, it is the defendant in 94% of its litigation. Approximately 63% of the lawsuits are labelled ERISA.
Cigna is represented by Cole Pedroza LLP, Gibbons, P.C., GrayRobinson, P.A., Saul Ewing Arnstein & Lehr LLP, as well as Alston & Bird in both 2020 and 2021. However, Cooley LLP; Holland & Knight LLP; Michael S. Metta; and Hinshaw & Culbertson LLP represented Cigna in 2020, but have yet to represent the company in 2021.
BlueCross Blue Shield
Blue Cross Blue Shield, which according to its website insures 1 in 3 Americans across its system of 35 companies, faced a variety of litigation recently. A lawsuit alleged the insurance company drastically underpaid the submitted bills and another lawsuit claimed the company failed to cover mental health care. Meanwhile, Blue Cross Blue Shield sued CVS for a purported systematic fraudulent scheme whereby CVS provided incomplete pricing data and inflated the amount insurance paid to offset the prices paid by patients that did not provide insurance information.
The litigation for Blue Cross Blue Shield has also been numerous from January 2020 to September 15, 2021 with 410 filings overall and 69 filings in the last three months. Litigation is currently 8% less busy than the previous three months. The lawsuits were most commonly filed in the Central District of California, the District of New Jersey, the District of Utah, the Northern District of California, and the Northern District of Illinois. Furthermore, these lawsuits are mostly tagged ERISA and employee retirement, as well as insurance.
Litigation for Blue Cross Blue Shield is more difficult to track because it is split up by state or area; Blue Cross of California, Blue Cross and Blue Shield of Florida, and others are separate entities. While it varies by local Blue Cross Blue Shield company, some of them are commonly represented by Reed Smith LLP including Blue Cross Blue Shield of California, Blue Cross Blue Shield of Illinois and Blue Cross Blue Shield of Texas. Overall, these entities are predominantly the defendant in the litigation they are involved in.
UnitedHealth Group, the market leader according to data from Statista, has faced lawsuits including being sued over the denial of behavior health treatment. Meanwhile, it reached a settlement with the Department of Labor over behavioral coverage and settled with New York over its alleged failure to cover mental health and substance abuse care. Moreover, UnitedHealth Group sued a former employee in January of this year after trade secrets were allegedly revealed to Humana.
Overall, UnitedHealth Group was involved in 95 lawsuits from January 2020 through September 15, 2021, of which six were filed in the past three months. Additionally, 20 lawsuits were filed in the Northern District of Ohio, 12 were filed in the District of New Jersey, 11 were filed in the Central District of California, and seven were filed in the District of Minnesota and the Eastern District of Virginia. Most of these lawsuits are tagged as healthcare/pharmaceutical personal injury product liability, employee retirement, and insurance, among others. UnitedHealth is the defendant in the majority of its litigation.
In 2020, Williams Mullen is the dominant law firm representing UnitedHealth Group, followed by O’Melveny & Myers LLP; Alston & Bird LLP; Dorsey & Whitney LLP; and Seyfarth Shaw LLP representing UnitedHealth in approximately the same number of cases. Jackson Lewis P.C.; Gibson, Dunn & Crutcher LLP as well as Greene Espel PLLP also represent UnitedHealth in 2020. However, in 2021, the representation is relatively evenly split between Williams Mullen; O’Melveny & Myers, Alston & Bird; Gibson, Dunn & Crutch, Jackson Lewis as well as Greene Espel. Thus far, Dorsey & Whitney and Seyfarth Shaw have yet to represent UnitedHealth in 2021.
Humana, which had 16.8 million medical members in 2020 according to Statista, has had a variety of litigation covering a variety of topics, such as data breach and payment for remote appointments, while Humana also sued pharmaceutical company Regeneron for its purported pricing scheme.
Humana is represented by Squire Patton Boggs; Porter Rogers Dahlman & Gordon P.C.; Eimer Stahl LLP in both 2020 and 2021. In 2020, Cooch and Taylor; Crowell & Moring LLP; Fowler White Burnett, P.A.; the Law Office of Daniel A. Milian; Gordon Reese Scully Mansukhani, LLP; and Schneider Wallace Cottroll Konecky LLP.
The District of Utah
The District of Utah is often the venue for health insurance litigation, in part due to the “youth treatment facilities” for which the state provides a welcoming environment.
According to a The Salt Lake Tribune investigation, while some of these facilities successfully treated individuals, others have been linked to physical or mental abuse. According to the article, states spend millions of Medicaid dollars to send troubled youth to various Utah facilities. Often, health insurance companies do not cover this type of care. As a result, the insurance companies are sued for failing to cover this treatment. The Law Offices of Brian S. King often represents plaintiffs in these cases.
Failure to cover mental health, addiction, or behavioral coverage often involves lawsuits asserting a violation Mental Health Parity and Addiction Equity Act, which requires health plans and health insurance companies to “offer mental health and substance use disorder benefits that are comparable to their coverage for general medical and surgical care,” according to the Department of Health and Human Services.
The large volume of lawsuits against health insurance companies is likely to continue in the future, especially in light of legislative pushes to remove barriers to suit for the insured. Health insurance representation remains fertile ground for law firms, and will do so as the pandemic continues.