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On Aug. 25, the California Department of Managed Health Care (DMHC) ordered Aetna Health of California, Inc. to stop using the plan’s national standard to deny payment for emergency room claims.
This practice has resulted in Aetna wrongfully denying members’ emergency room claims, as the plan should be applying California’s broader standard to approve emergency room services. DMHC also fined Aetna $500,000 for repeatedly failing to apply California law and failing to implement actions to correct this problem.
In 2015 and 2016, Aetna entered into settlement agreements with DMHC and paid $135,000 in fines. It also agreed to Corrective Action Plans requiring training for employees handling claims for emergency services and reimbursement for emergency services based on the California standard.
But despite the enforcement actions taken, the DMHC Help Center received four complaints in 2018 and 2019 showing that the plan had wrongfully denied emergency room claims based on the incorrect standard.
A final survey issued by DMHC in 2019 concluded that 93% of the sampled claims were wrongfully denied. DMHC also reviewed Aetna’s commercial emergency medical services denial template for HMOs and determined that the templates did not follow California law.
California law requires a health plan to pay for emergency medical services unless it has evidence to show that either the emergency medical services were never performed or the enrollee did not require emergency medical services and reasonably should have known that an emergency did not exist.