California fines top insurers $600k for overstating physician networks

The California Department of Managed Health Care has levied fines of $350,000 against Blue Shield of California and $250,000 against Anthem Blue Cross over inaccurate provider directories that overstated their physician networks during the rollout of Affordable Care Act coverage in 2014, according to a Los Angeles Times report.

In addition to paying the DMHC fines, the insurers will also pay millions of dollars in refunds to patients who paid too much for care because they relied on the erroneous directories. Blue Shield of California has already paid out $38 million to enrollees who incurred out-of-network costs. DMHC officials didn't have a reimbursement figure for Anthem yet, according to the report.

Last year, the DMHC released results of an investigation that found more than 25 percent of the physicians listed on Anthem and Blue Shield of California's directories were not taking patients in the Covered California health exchange or were no longer at the location the payers listed.

Due to consumer complaints, including those targeted at Blue Shield of California and Anthem, California lawmakers passed legislation requiring insurers to update their provider directories on a weekly basis.

Both Anthem and Blue Shield of California have acknowledged mistakes were made, and both have taken steps to correct their provider directory issues, according to the report.

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