Physicians to Recoup Claims Denials from Aetna

Thanks to an effective mediation process, Aetna, an insurance plan that contracts with many FPs, has agreed to rectify a payment dispute dating back to July 2004. Aetna's action stands to benefit not just the physicians directly involved in the dispute -- but all physicians who do business with the insurer.

For nearly two years, physicians who billed for an evaluation and management visit and a procedure on the same day -- and correctly appended the E/M code with the modifier -25 -- were routinely denied payment for the procedure portion of the visit. Apparently, a mix-up in the appropriate use of modifiers caused the disagreement; Aetna wanted such claims appended with the modifier -59.

The mediation in the dispute was one of the terms of a settlement agreement reached in May 2003 between some of the nation's largest health plans, including Aetna, and more than 800,000 physicians and state and county medical associations. The class action lawsuit alleged that the health plans violated federal civil racketeering laws by scheming to deny payments to physicians.

As part of the mediated solution, Aetna will automatically reprocess previously denied claims that date back to July 1, 2004. Physicians who filed compliance disputes on the modifier -25 issue will have their claims reworked dating back to May 21, 2003, the date of the class settlement, according to Cynthia Michener, Aetna's public relations manager.

Physicians do not need to take any action. Details of the agreement, along with a complete list of the more than 200 affected procedure codes, are posted on Aetna's Web site.

"This is a big deal. Physicians whose services were denied will be reimbursed accordingly without need for resubmission of claims," said Cynthia Hughes, AAFP's coding and compliance specialist.

"The list includes procedures common to an FP's practice, such as venipuncture, arterial puncture, inhalation treatments and electrocardiograms. The fact that Aetna will automatically reprocess these (claims) means that physicians may recover what was written off in error," said Hughes.

As a permanent solution, Aetna is updating its claims processing system to reimburse certain specific procedure codes when billed with an E/M code appended by the modifier -25, said Michener. However, to expedite payment on new claims until system changes are complete, physicians may append the modifier -59 to the minor procedure codes listed on Aetna's Web site and billed with an E/M code.

According to a notice on Aetna's Web site, physicians who prefer to use the modifier -25 during the interim period will receive payment, but processing of those claims may take longer.

Michener cautioned that until Aetna's information technology system corrections are completed late in 2006, "providers may continue to receive payment denial notices that have been automatically generated by our claim system." She said physicians should disregard these notices. "No action is needed on their part. Aetna will periodically run reports to capture these claims and will then manually reprocess for payment," she said.