Nationwide Improper PPO Discount Class Action Certified

April 18, 2013

The Honorable Dennis J. Hubel of the Federal District Court for the District of Oregon certified a class action on behalf of all health care providers in the country that had a Preferred Provider Organization (“PPO”) Agreement with the First Health Network.  The class members in the class action are health care providers (such as doctors and physical therapists) who provide medical services to injured workers in the workers’ compensation system, and who contracted to be part of defendant’s First Health PPO network.

The lawsuit alleges that the defendant, Coventry Health Care, breached its PPO Agreement with the providers by reimbursing the incorrect amount for medical services.  Specifically, the plaintiffs allege that Coventry’s computer system takes improper “PPO discounts” when the amount that the provider charges to the patient is less than the maximum amount payable under a state’s workers’ compensation fee schedule.  Because of the improper discount, Coventry allegedly reimburses less than what the contract requires.

The class action that was certified is an injunctive class action that will seek to compel Coventry to change its practices in the future.  The trial is expected to take place later this year.

The case is entitled Chehalem Physical Therapy, et al v. Coventry Health Care, Inc.

Portland, Oregon lawyers Steve Larson and Josh Ross from the Stoll Berne firm, and Diana Godwin, were appointed as class counsel, as well as the Murray Law Firm, the Williams Family Law Firm, and Cox Cox Filo, all based in Louisiana.

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