Lawsuit pits pharmacists against HMO practices
Reimbursement program's end is a sign of times
Pharmacists in New York and New Jersey are lining up for the discovery phase of a class action lawsuit against Aetna U.S. Healthcare, one of the nation's five largest health maintenance organizations, over a reimbursement/capitation program that no longer exists.
The pharmacy outlets - numbering well over 1,000 and led into court by the New York City Pharmacists Society - are suing over funds they say Aetna owes them from fiscal years 1996 and 1997, a full 18 months after Aetna pulled the plug on its Pharmacy Service Agreement program. The capitation program paid each participating pharmacy a fixed monthly capitation fee for each patient enrolled with a given pharmacy.
At issue is part of the program that set up a Pooled Cata strophic Fund, where by Aetna held 15% of the monthly fees then gave them back to pharmacists semiannually when costs exceeded monthly payments. When Aetna bought U.S. Healthcare in the summer of 1996, the fund payments and the retail pharmacy program itself ended. But area pharmacists say they still are owed money for the last six months of 1996 and the first six months of 1997. Pharma cists also are contending they were unaware the 15% held in the fund was increased later to 20%.
How much money does that come to? "That's the $64,000 question," says attorney David Berger of New York's Allegaert, Berger & Vogel, the firm representing New York and New Jersey pharmacists in the suit. (Set up as a regional program largely in New York, New Jersey, and Pennsylvania, to date pharmacists as members of the New York City, and Garden State pharmacists societies have filed on behalf of their membership, resulting in about 1,000 pharmacies taking on active class action status.)
In Aetna's relatively brief eight-page response to the suit, attorneys from Fieldman, Hay & Ullman, also in New York City, deny any wrongdoing and simply state the fund was empty at the time Aetna bought U.S. Healthcare and ended the program, so there was no money to give the pharmacists for the two six-month periods in question. Aetna's attorneys also say pharmacists were given a "timely notice" the 15% being pooled from the monthly fees was increasing to 20%.
Before the summer 1996 merger of Aetna and U.S. Healthcare, Aetna's 44,000 pharmacy contracts were done on a fee-for-service basis, while U.S. Healthcare's 8,000 pharmacy agreements were done as a capitation model. When the merger went through, as a company spokesperson put it, it was simply easier to switch 8,000 pharmacies to a fee-for-service program than the other way around. (It also was cheaper for the HMO in the long run.) At the time, U.S. Health care primarily was doing business in the North east, the region where the class action lawsuit is being played out. Pharmacists involved say they can live with a fee-for-service agenda - and most did sign up - but they repeat that the funds are still owed under the old capitation contract with U.S. Healthcare.
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