Aetna Settles Class Action Lawsuit for $120 Million
On Friday, Aetna announced that it has settled a class action lawsuit, initially filed on July 30, 2007, "regarding its practices related to the payment of claims for services rendered to Aetna members by health-care providers with whom Aetna does not have a contract."
Under the terms of the settlement, Aetna says it has resolved all member claims relating to out-of-network reimbursement nationwide, dating from March 1, 2001 through the date the New Jersey Federal Court grants preliminary approval of the settlement. The period for settlement of claims by health-care providers runs from June 3, 2003, through the approval date.
Aetna did not admit liability as part of the settlement. In exchange for paying $60 million upon final approval of the settlement, and a potential $60 million more by the end of the period for submitting and validating claims under the settlement, Aetna will have no further liability.
Final court approval of the settlement is expected in mid-2013, but could be delayed. Additionally, Aetna has the right to pull out of the settlement entirely if not enough claimants in the plaintiff class agree to participate in the settlement.
Aetna is taking a $78 million after-tax charge to fourth quarter earnings in connection with the settlement. Aetna shares closed up 3% Friday after the settlement was announced.
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