Bulletin: May 17, 2005

Prudential and Health Net settle physician lawsuits

By: , Compliance Officer

Prudential Insurance of America and Health Net agreed in a settlement dated May 3, 2005 to pay more than 80 million dollars to settle a national class action lawsuit.

Under the settlement, which still must be approved by the U.S. District Court in Miami, Health Net will pay an $39 million to a settlement fund for payments to physicians, $20 million in legal fees, and $1 million to a fund to be used to ensure compliance with the settlement. They will also develop and implement plans to improve how they do business with physicians, including speeding up claims processing and creating an external board to resolve billing disputes.

Prudential, which sold its health care subsidiary to Aetna in 1999, agreed to pay $22.2 million. Court-imposed deadlines concerning both settlements:

• June 6, 2005: Deadline to mail copies of Notice of Class Action and Proposed Settlement to all potential Class Members.
• July 6, 2005: Deadline for legal notices to be published.
• September 5, 2005: Deadline to “Opt-Out” of the Health Net and/or Prudential Agreements.
• September 9, 2005: Deadline for Objector’s papers to be filed/served.
• September 19, 2005: Settlement/Fairness Hearing.