Insurer to pay $12 million to settle claims-related complaints

United Healthcare has agreed to pay at least $12 million in fines to 36 states and the District of Columbia to settle allegations that it violated state laws in its handling of health insurance claims. If more states join the agreement, United could pay up to $20 million in fines.

Insurance officials from several states began investigations into United's claims payment practices in 2004 in response to numerous complaints. Officials found that the insurer “applied incorrect fee schedules and deductibles, didn't promptly pay claims and was generally unable to correct problems pointed out by state regulators,” the Associated Press reported on Sept. 6.

United has also agreed to a three-year improvement plan that requires the insurer to meet annual benchmarks regarding the accuracy and timeliness of its claims processing. Failure to meet the benchmarks will result in $8 million in additional fines. Here again, if more states sign on, the additional fines could also increase to $20 million.

Companies make unhealthy employees pay

Some employers have found a new way to save on health care costs: Make high-risk employees pay more. The Associated Press reported on Sept. 9 that Clarian Health plans to reduce employees' pay by $10 per paycheck if their BMI is in the obese range or by $5 if they fail to meet certain cholesterol, blood pressure or blood glucose measures. Western & Southern Financial Group makes employees pay an additional $15 to $75 monthly toward their insurance costs based on their BMI. Scott's Miracle-Gro docks employees $40 per month if they don't complete annual risk assessments and $65 if they don't take steps to reduce any identified health risks.

Such companies insist their programs aren't just about cost cutting but also improving employee health. Critics say the programs harm patient privacy and penalize vulnerable individuals more than they help them.

More physicians move to mid-sized practices

U.S. physicians are moving away from solo and two-physician practices toward larger, mostly mid-sized practices, according to a recent report from the Center for Studying Health System Change (HSC). The proportion of physicians in solo or two-person practices dropped from 40.7 percent to 32.5 percent between 1996–1997 and 2004–2005, while the proportion of physicians in mid-sized practices (six to 50 physicians) increased from 13.1 percent to 17.6 percent.

The report noted that, as greater incentives are attached to quality and information technology, more physicians are likely to move to large, multispecialty practices. “Larger practices are more likely to have the financial and administrative resources to collect quality data, implement quality improvement and reporting activities, and implement information technology, while multispecialty practices are better positioned to enhance care coordination,” it said.

The report acknowledged, however, that similar predictions in the 1990s that large, multispecialty practices would become the norm did not come true. Solo and two-physician practices continue to be the most common practice arrangement, despite their shrinking numbers.

The report is based on more than 6,000 telephone surveys of physicians.