As with the settlement reached earlier this year with Aetna, one of the other defendants in this case, Cigna has agreed to make significant changes to the way it works with physicians. Under the settlement, Cigna will make its fee schedules and payment rules available to physicians; adopt a clear "medical necessity" definition that will allow physicians to care for their patients without being second-guessed by insurance administrators; abide by fairer payment rules; not impose "all products" or "all affiliates" clauses; and establish an independent appeals process for physician billing disputes. These changes are expected to speed up payments to physicians and lower their administrative costs.

"This is another step in the right direction. This is clear evidence that Cigna has a strong desire to reach out to physicians and their patients," says CMA CEO Jack Lewin, M.D. "With these settlements, Cigna and Aetna are sending a clear signal that they are willing to structure their business practices in a way that benefits both doctors and their patients."

Cigna will also help fund the health care foundation established under the Aetna settlement that will promote physician-directed improvements to patient safety and quality of care.

As redress for the more than 700,000 physicians represented in this class-action suit, the settlement provides a minimum of $70 million to be divided among plaintiffs, which works out to approximately $100 per physician. The total value of the settlement is more than $500 million, $400 million of which will be in the form of substantial administrative savings resulting from Cigna’s business practice improvements.

Contact: CMA’s legal information line, 415/882-5144 or legalinfo@cmanet.org.