Aetna, Optum can’t escape class-action status in ‘dummy code’ case

The 4th U.S. Circuit Court of Appeals said Sept. 13 it won’t review a lower court’s ruling that certified class-action status in a lawsuit alleging Aetna and OptumHealth Care Solutions conspired to use “dummy code” to make administrative fees appear to be billable medical charges.

Advertisement

The three-judge panel unanimously denied Aetna and Optum’s request to review a North Carolina federal judge’s June decision to certify class-action status, according to court records. The judges did not provide an explanation for their decision in the order. 

The lawsuit, which was originally filed in 2015, alleges the two insurers tricked plaintiff Sandra Peters, other patients similarly situated and their employers into paying administrative fees by disguising them as medical expenses. The lawsuit alleges the defendants violated the Employee Retirement Income Security Act. 

The two classes certified by the judge could cover more than 87,000 health plan participants, according to court records. 

A judge initially ruled in Optum and Aetna’s favor in 2019, but a federal appeals court reversed the decision in 2021, finding that Aetna conducted a “breach of its fiduciary duty” in burying administrative fees and that Optum utilized unauthorized transactions.

The Supreme Court denied Optum’s bid to drop the lawsuit last year

At the Becker's 5th Annual Fall Payer Issues Roundtable, taking place November 2–3 in Chicago, payer executives and healthcare leaders will come together to discuss value-based care, regulatory changes, cost management strategies and innovations shaping the future of payer-provider collaboration. Apply for complimentary registration now.

Register to Attend Webinar

Read. Deleted. Ignored. What It Takes to Drive Behavior Change and Lower the Cost of Care

Tuesday, August 4
11:00 AM - 12:00 PM CDT

Presenters: Koleen Cavanaugh, Independence Blue CrossBukata Hayes, HMO Minnesota (Blue Plus)Nathan Foco, Select HealthTrish Cox, SCAN Health PlanJonas Puente, ZS Associates

Advertisement

Next Up in Payer

Advertisement

Comments are closed.