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Aetna HMO targeted by class-action suit
HATTIESBURG, Miss. – A lawsuit filed here in federal district court by a one of the most active lawyers in cases against U.S. tobacco companies seeks class-action status on behalf of allegedly defrauded HMO subscribers.
The suit charges that statements by Aetna Inc. and its managed-care subsidiaries (including Aetna U.S. Healthcare) that their primary mission was improving the quality of care were “misleading and deceptive misrepresentations and omissions”. The lawsuit was announced the same day that the U.S. House of Representatives voted on the Norwood-Dingell patient protection bill.
Fraud, other accusations
According to a press release from the law firm Scruggs, Millette, Bozeman & Dent, the suit was filed on behalf of Jo Ann O’Neill, an Aetna subscriber from Lufkin, Texas, and 18.3 million others who have had health-care coverage from Aetna since July 19, 1996, the date Aetna acquired U.S. Healthcare.
The suit is based on accusations of wire fraud (because marketing materials from Aetna allegedly used fraud to induce people to join the plan), violations of the Racketeer Influenced and Corrupt Organizations Act (because “The defendants engage in extortionate conduct designed to exploit physician fear of economic loss…” according to the press release from the plaintiff’s lawyers) and Aetna’s alleged failure to meet its legal obligations as a health insurer under the Employee Retirement Income Security Act.
Big tobacco money
The suit was filed by a team of lawyers led by Richard Scruggs, of Pascagoula, Miss. Mr. Scruggs represented tobacco industry whistleblower Jeffrey Wigand and was a key attorney in suits by state Medicaid programs against the tobacco companies.
The Journal noted that Mr. Scruggs and other plaintiff’s attorneys on the Aetna suit who were part of legal teams in the tobacco suit have “hefty war chests to pursue the claims.” Last year Mr. Scruggs pledged $1 million annually for 25 years to the College of Liberal Arts of the University of Mississippi, from which he graduated in 1969.
In a company press release, Aetna said it will defend itself against the “outrageous” charges in the suit.