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Aetna awarded $51.4 million from Texas hospital in false billing case

Judge also ruled that Humble Surgical Hospital was paying kickbacks of 30 percent of facility fees to 103 physicians in exchange for referrals.

Susan Morse, Senior Editor

Aetna has been awarded $51.4 million in a civil case against a Texas healthcare provider that allegedly charged patients in-network rates but billed the insurer at out-of-network rates.

A federal judge in southern Texas also ruled that Humble Surgical Hospital in Humble, Texas, was paying kickbacks of 30 percent of facility fees to 103 physicians in exchange for referrals. The kickbacks were paid out of money it billed Aetna, the court ruling said.

Humble waived the patient's share of the bill, according to the court order. Humble promised patients their out-of-pocket expenses would be equal to or less than in-network, and that they would possibly receive a refund if the insurer paid in full.

Through the provider's attorneys, Humble has indicated it would appeal the decision.

[Also: Court blocks Aetna, Humana merger]

Humble is a five-bed hospital that opened in August 2010. It set its prices comparable to major Houston hospitals, using the 3,000-plus- bed Memorial Hermann as its standard, according to U.S. District Court Judge Lynn Hughes.

Humble is not part of Aetna's network.

From August 2010 to May 2012, Humble submitted $68 million in out-of-network claims, court records show, but Aetna paid $27 million. If Humble had billed Aetna the same way it told the patients it would -- at in-network rates -- Aetna would have paid $7 million, Hughes ruled.

"Because no economically rational patient would choose it over an in-network provider, Humble paid referral fees to doctors, waived patient costs and submitted inflated bills to Aetna," Hughes said.

[Also: Aetna faces class action lawsuit over Obamacare exits]

Cigna was involved in a similar case against Humble Surgical Hospital, in which the Southern District Court in Texas last year ruled in the provider's favor.

Cigna sought recovery of overpayments of $5 million that it alleged resulted from Humble's fraudulent practices of routinely waiving patients' financial responsibility and paying kickbacks to physician owners of the hospital for unlawful referrals.

Federal Judge Kenneth Hoyt dismissed all claims by Cigna and found no evidence of improper billing for care and services by the hospital, according to the Humble website. The judge said Cigna's claim denials were based on the insurer's flawed interpretation of exclusionary language in self-funded plans it administered.

In June 2016, Cigna was ordered to pay Humble nearly $13.7 million.  Of this, $11.4 million was for payment of out-of-network services provided by Humble.

Twitter: @SusanJMorse

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