Health insurance giant Anthem Blue Cross faces another lawsuit over switching consumers to narrow-network health plans — with limited selections of doctors — during the rollout of Obamacare.
These types of complaints have already sparked an ongoing investigation by California regulators and other lawsuits seeking class-action status against Anthem and rival Blue Shield of California.
A group of 33 Anthem customers filed suit Tuesday in Los Angeles County Superior Court against the health insurer, which is a unit of WellPoint Inc. Anthem is California’s largest for-profit health insurer and had the biggest enrollment this year in individual policies in the Covered California exchange.
In the latest suit, Anthem members accuse the company of misrepresenting the size of its physician networks and the insurance benefits provided in new plans offered under the Affordable Care Act.
In many cases, consumers say, Anthem canceled their more generous PPO, or preferred-provider organization, plan and moved them to a more limited EPO, or exclusive-provider-organization, policy.
Compounding the problem, the plaintiffs say, the company gave misleading or incorrect information, both last fall and this year, about the medical providers participating in these new plans.
As a result, some consumers incurred unforeseen medical bills when they were treated by out-of-network doctors, according to the suit. EPO health plans usually have little or no coverage outside the network.
“Anthem profits from the premiums while these members cannot see their doctors,” said Scott Glovsky, a Pasadena attorney representing the Anthem customers.
Anthem said it hadn’t seen the lawsuit filed Tuesday. The company has previously defended its conduct and said consumers were properly notified about these changes.
The health insurer has said “materials at the time of enrollment and in members’ explanation of benefits have clearly stated that the plan was an EPO plan which may not have out-of-network benefits.”
The California Department of Managed Health Care said its investigation into network-related complaints at Anthem and Blue Shield is still ongoing.
Many health insurers offered smaller lists of providers at lower reimbursement rates to help hold down premiums for individual policies this year. Anthem and other insurers largely stuck with that narrow-network strategy for 2015 plans in Covered California and outside the exchange.
To address some of these concerns, state lawmakers and consumer advocates are pushing for additional legislation.
State Sen. Ed Hernandez (D-West Covina) is backing a Senate bill (SB 964) that seeks to increase state monitoring and enforcement of existing rules on network adequacy and timely access to care.
“We have to make sure those individuals that signed up actually have access to healthcare,” Hernandez said.
Health insurers say they have added thousands of doctors to their networks this year to improve coverage, and they oppose SB 964 because it’s redundant to current rules.