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Humana Agrees to Proposed Settlement with Chiropractors, Non-MD Providers for $3.5 Million

(Arlington, Va. - Aug. 16, 2006) Humana has agreed to a class action settlement resolving claims on behalf of chiropractors and other health care providers in Solomon v. Anthem, et. al., pending before Judge Frederico Moreno of the U.S. District Court for the Southern District of Florida. The ACA participated, through its counsel, in the settlement discussions and is a signatory to the proposed class action settlement agreement. If approved by the Court, Humana will pay $3.5 million to fund payments to class member chiropractors and other health care providers as well as fees and costs advanced by class counsel. Plaintiffs in the Solomon action recently filed a motion seeking to add the ACA as a named plaintiff in the Solomon case and requesting that ACN Group, Inc. and United Healthcare Services, Inc. be added as defendants. The case against ACN, United Healthcare Services and all remaining defendants is still pending. In addition to the cash fund described above, terms of the proposed settlement agreement with Humana include: • Changes in Humana’s business practices, intended to make its claims editing process more transparent and reduce confusion and disagreement over payments. • Online information provided by Humana to help providers understand its payment decisions. • More options for chiropractors and other health care providers to challenge Humana payment decisions in the future, if necessary. • Independent external reviews to resolve billing disputes. • The appointment of an ACA representative to a newly formed Humana health care provider advisory committee, which will provide a means of direct communication on issues and concerns. “We are extremely pleased that Humana has agreed to compensate chiropractors and other non-MD providers for claims that were previously and wrongly denied,” commented ACA President Richard Brassard, DC. “More importantly, however, we are heartened that Humana has committed to improving its business practices in the future and are hopeful that other networks and insurance companies will follow suit. Doing so can only benefit the nation’s health care consumers, who also deserve fair treatment and reimbursement.” As part of the settlement, doctors of chiropractic will be permitted to assign their portion of the recovery to the ACA, if they wish to do so. For a copy of the settlement agreement, click on the link below.


540,000 New Yorkers were at Risk for Identity Theft

As Many as 540,000 New Yorkers were at risk for identity theft after a security breach was detected. Claimants of NYS Special Funds, a workers compensation carrier, recently received letters describing the possible theft of a personal computer, which contained their private information. However, it was reported today that the computer has been located and is secure. FBI is "reasonably certain" the information was not misused Read the story by clicking on the link:


ACA's Legal Efforts Against ACN Continue, Despite Adverse Ruling in Similar Class Action

Arlington, VA -- The American Chiropractic Association (ACA) continues to aggressively challenge the practices of ACN Group Inc. on multiple fronts and remains optimistic that the chiropractic profession can find relief from the managed care organization's tactics, despite an adverse ruling in a similar federal class action suit against UnitedHealthcare, a sister company of ACN. On June 19, a federal judge in Miami dismissed a national class action lawsuit brought against UnitedHealthcare and Coventry Health by 700,000 medical doctors who claimed the insurers had conspired to arbitrarily deny or reduce claims. U.S. District Judge Federico Moreno dismissed the lawsuit, known as the Shane case, due to "insufficient evidence" that the carriers conspired to deny claims in a coordinated manner. While the ACA is disappointed in this decision -- because the ruling could set a precedent and portend an adverse judgment in the Solomon case -- legal experts point out that the two cases are different and the possibility of prevailing still exists. In the Shane decision, Judge Moreno wrote that he did not condone the insurers’ practices, but he simply could not find enough evidence of a conspiracy after reviewing thousands of documents. According to ACA's legal team, the evidence ACA has compiled against ACN, which is not a party in the Shane case, is substantial and the court that made the decision in the Shane case has yet to review it. In addition, legal action is just one track in ACA's multi-pronged strategy against ACN. In addition to filing this national class action, ACA -- in cooperation with several state chiropractic associations -- is actively engaged with a number of state attorneys general, offices of insurance and boards of licensure, and the Federation of Chiropractic Licensing Boards (FCLB) regarding the tactics undertaken by ACN. According to ACA officials, these state attorneys general and state offices of insurance are reviewing the practices of ACN and other chiropractic managed care organizations and some are launching their own investigations. "The federal court's action is clearly disappointing,” said ACA President Richard Brassard, DC. “But I want to stress to the profession -- and especially to the doctors currently suffering under ACN policies -- that the ACA will exhaust every legal, administrative and political means to redress these problems. The ACA was created to fight for our patients and for chiropractic. We now have a fight of monumental proportions on our hands. We are confident we can prevail with the remedies available to us with the support of all in the profession." To augment ACA’s legal efforts, individual doctors of chiropractic and chiropractic state associations are being asked to take action by filing complaints with state regulatory agencies. In addition, doctors are encouraged to use ACA's ERISA pre-service template letters, found at, to notify patients’ employers that the benefit they purchased for the employee is not accessible when medically necessary treatment is denied.



MEMORANDUM IN SUPPORT OF A.4527/S.3340: INSURANCE EQUALITY The NYSCA Legislative Committee has been working diligently with lobbyist Don Mazzullo in an effort to promote the Insurance Equality Bill to the New York State Senate and Assembly. Accordingly, Mr. Mazzullo has composed the attached position paper, designed to enlist backing for this important bill, which has been distributed to all New York State legislators. NYSCA encourages all of its members to review the attached memorandum, since passage of the Insurance Equality Technical Corrections Bill is of great importance to all Doctors of Chiropractic in New York State


American Chiropractic Association Files Lawsuit Against ACN in Federal Court

The American Chiropractic Association (ACA) today asked the U.S. District Court in Miami to allow ACA to join as a plaintiff in the pending nationwide class action lawsuit Solomon v. Anthem, et al., and further asked that ACN Group, Inc. and United Healthcare Services, Inc. be named as additional defendants in the case. The ACA alleges that ACN participated with other managed care companies in the case in a conspiracy to illegally and systematically underpay providers by denying reimbursement for medically necessary treatment. ACA, along with other national and state health care associations, individual doctors of chiropractic and other health care providers, challenge the utilization review and payment practices of some of the nation’s largest managed care companies, including Health Net, Humana, PacifiCare Health Systems, Aetna, United Healthcare, Wellpoint Health Networks and Prudential. The case alleges that these companies, including ACN, violated the Racketeer Influenced and Corrupt Organizations (RICO) Act by systematically and illegally denying, delaying, and diminishing payments owed to chiropractors and other health care providers. Joining the ACA in its efforts against managed care companies, particularly ACN, is the Connecticut Chiropractic Association, who is also seeking to be named as a plaintiff in the litigation. The Florida Chiropractic Association is also a plaintiff. “There is simply no greater priority for ACA than to oppose what we view as the abusive tactics of ACN and other managed care organizations who systematically deny needed chiropractic care to our patients,” said ACA President Richard G. Brassard, DC. “Doctors from across the country have provided us with reports of intimidation and coercion conducted under the guise of utilization control. This can no longer be tolerated by a profession dedicated to quality patient care. The ACA intends to expend every effort and seek every possible legal remedy to put a halt to these harmful practices.” The suit calls into question the use of financially expedient cost and actuarial criteria rather than appropriate bases of medically necessary treatment for utilization review, and alleges that these criteria are purposely imposed on providers with the knowledge that they cannot be met. Through this legal action, ACA will seek damages against ACN and the other defendants in the case on a class-wide basis. It will also seek to obtain injunctive relief to bring an end to what it views as the abusive practices and procedures of ACN. “Our case involves protection of the doctor-patient relationship as to whether care will be provided on the basis of medical necessity, or based on what we believe are contrived policies and statistics skewed to maximize profits for managed care organizations such as ACN,” said ACA Chairman Lewis Bazakos, DC. Specifically, the complaint states the defendants, including ACN: -- Systematically refused to compensate health care providers for covered services; -- Processed health care providers’ claims using either automated programs which manipulate standard coding processes or use unqualified personnel to determine whether or not the service provided was medically necessary and covered; -- Downcoded and bundled legitimate claims to less costly procedures; -- Arbitrarily refused or reduced payment for certain categories of treatment; -- Systematically failed to recognize valid assignments of benefits; and, -- Delayed payments to health care providers by requesting additional documentation, even when such documents should not be required. The ACA’s overall campaign to correct the harmful practices of some managed care networks is an outgrowth of a resolution passed by the ACA House of Delegates in March 2002 formally outlining ACA’s opposition to the improper practices of chiropractic networks. “Doctors are being forced out of their practices daily by the abusive tactics of ACN and other managed care organizations. The ACA has listened to these doctors and other doctors practicing under the threat of unwarranted terminations,” Dr. Brassard said. “Like the generations of chiropractors before us, the ACA will not back away from its responsibility to protect the profession and the patients we serve. We ask the entire profession to unite with us in this effort, as the outcome will profoundly affect the way chiropractic care is provided now and in the future.” Actions at the State Level In addition to the filing of this national class action, ACA—in cooperation with several state chiropractic associations—is actively engaged with a number of state attorneys general, offices of insurance and boards of licensure, and the Federation of Chiropractic Licensing Boards (FCLB) regarding the tactics undertaken by ACN. To help augment the legal efforts underway by ACA, individual doctors of chiropractic and chiropractic state associations are being asked to take action by filing complaints with state regulatory agencies. Furthermore, doctors are encouraged to use ACA’s ERISA pre-service template letters, found at, to notify a patient’s employer that the benefit they purchased for the employee is not accessible when medically necessary treatment is denied. To view copies of pleadings filed by ACA in the U.S. District Court in Miami, or for more information on ACA's managed care initiatives, visit ACA's Chiropractic Networks Action Center.

MultiPlan Acquired by The Carlyle Group

Nation’s Largest Independent PPO Poised for Growth New York, NY – MultiPlan, Inc. and The Carlyle Group yesterday completed the previously announced acquisition by Carlyle of MultiPlan, the largest independent PPO in America. This acquisition will facilitate the growth of MultiPlan’s market share and expansion of its medical cost management solutions, which include the national PPO network, specialty networks, negotiation services and a claim transaction and information management engine. Mark Tabak, Chief Executive Officer of MultiPlan, said, “These are exciting times for MultiPlan, and MultiPlan is an exciting company for our time. We’re a significant player in a trillion-dollar market, and with new owners committed to our success we’re even better positioned for impressive growth.” Karen Bechtel, Managing Director and Co-head of Carlyle’s Healthcare Group, said, “We’re pleased to have gotten to this important stage. MultiPlan has the proven technology and management depth necessary to bring its growth plan to fruition. We look forward to supporting the company’s strategy and making this a successful investment.” Headquartered in New York, MultiPlan is the oldest and largest independent Preferred Provider Organization (PPO) network offering nationwide access to more than 4,300 hospitals, 100,000 ancillary care facilities and 450,000 physicians and specialists. MultiPlan serves a base of 2,000 large and mid-sized insurers, third-party administrators, self-funded plans, HMOs and other entities that pay claims on behalf of health plans. The company’s top 10 clients together deliver health coverage to more than 70 million Americans. About MultiPlan For 35 years, MultiPlan has helped healthcare payers and providers partner together to combat rising healthcare costs. MultiPlan serves as a single gateway to a host of primary, complementary and out-of-network strategies for managing the financial risks associated with healthcare claims. Clients include large and mid-sized insurers, third-party administrators, self-funded plans, HMOs and other entities that pay claims on behalf of health plans. About The Carlyle Group The Carlyle Group is a global private equity firm with $39 billion under management. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Asia, Europe and North America, focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, healthcare, industrial, technology & business services and telecommunications & media. Since 1987, the firm has invested $18.1 billion of equity in 463 transactions for a total purchase price of $73.2 billion. The Carlyle Group employs more than 650 people in 14 countries. In the aggregate, Carlyle portfolio companies have more than $46 billion in revenue and employ more than 184,000 people around the world.


Through private market reforms, all Massachusetts citizens to be insured by 2009 Governor Mitt Romney signed landmark legislation today that through a private, market-based reform will make health insurance available to every resident of Massachusetts within the next three years. “An achievement like this comes around once in a generation, and it proves that government can work when people of both parties reach across the aisle for the common good,” said Romney. “Today, Massachusetts is leading the way with health insurance for everyone, without a government takeover and without raising taxes.” The legislation was approved by a bipartisan 154-2 margin in the House of Representatives and a 37-0 vote in the Senate. It was signed at a Faneuil Hall ceremony attended by hundreds of people. “This would not have been possible without the courageous work of Senate President Travaglini, Speaker DiMasi, providers, insurers, consumer groups and all the other industry stakeholders who recognized an opportunity to do something historic,” said Romney. The law requires every individual in the state to purchase health insurance by July 1, 2007. Of the approximately 500,000 uninsured, about 100,000 are eligible for Medicaid, another 200,000 making less than 300 percent of the federal poverty level, but not eligible for Medicaid will receive premium assistance on an income-based sliding scale for policies with no deductibles, and another 200,000 with incomes above 300 percent FPL will be able to purchase lower-cost policies in the private market. Premium assistance will be financed by redirecting a portion of the $1 billion currently spent by state government on the uninsured. Beginning on January 1, 2008, failure by individuals to purchase health insurance will result in the loss of their state tax refund equal to 50 percent of an affordable health insurance premium. Penalties will be assessed for each month without creditable coverage. The creation of an entity, the Commonwealth Care Health Insurance Connector, will allow individuals to now purchase affordable plans on a pre-tax basis. The Connector will administer premium assistance for low-income individuals and facilitate employer contributions for both full-time and part-time workers and those working at more than one company. Eligible to purchase through the Connector are non-working individuals, working individuals at companies that do not offer health insurance, workers not eligible for coverage at their place of business such as part-timers, contractors and new employees, small businesses with 50 or fewer employees, and those who are self-employed. The legislation also enhances the goal of greater transparency in health care cost and quality through the collection and publication of data needed by consumers to make informed decisions. The information will allow consumers to compare the quality, track record and cost of hospitals and providers. The passage of the legislation moves Massachusetts closer to the implementation of a waiver that will allow the state to continue to receive $385 million in federal funding for each of the next two years. The waiver was negotiated by Governor Romney and Senator Kennedy last year, and was dependent on the state developing a “demonstration project” to reduce the rate of uninsured. The Executive Office of Health and Human Services has already begun providing details of the Massachusetts plan for review by federal Medicaid officials. Former U.S. Health and Human Services Secretary Tommy G. Thompson commended Governor Romney for signing what Thompson termed “groundbreaking legislation to provide health coverage to all Massachusetts families.” “Massachusetts is showing us a better way, one I hope policy makers in Statehouses and Congress will follow to build a healthier and stronger America,” said Thompson, a former Republican governor of Wisconsin. The Governor vetoed the creation of a new fee on businesses. The $295 per employee fee would have been assessed to employers with 11 or more full-time workers who do not offer and contribute to their employees’ health insurance. The Governor said the fee is “not necessary to implement or finance health care reform.” The Governor also vetoed a provision to provide dental benefits to adult Medicaid recipients, which will cost $75 million annually. Romney said the benefits expansion is financially unsustainable and noted that it provides a service not offered by most Massachusetts employers. Sixty percent of employers in Massachusetts do not provide dental coverage to their workers.



U.S. Senator Mike Enzi (R-Wyoming) Chairman of the U.S. Senate Health Education and Labor (HELP) Committee is the primary sponsor of S.1955, proposed legislation intended to help small businesses and associations obtain more affordable group health insurance for their employees. While well intended, this legislation would extend ERISA’s preemption to cover the small group insurance market now regulated at the state level. As a practical matter, this legislation would render useless state-enacted legislation such as chiropractic specific mandates, any-willing provider, and insurance equality laws intended to protect health care providers and consumers. If enacted into law, S.1955, would preempt all state mandated benefit legislation not just those that are specific to the chiropractic profession. Press Release LANDMARK AGREEMENT REACHED ON HEALTH INSURANCE MARKET REFORM BILL, ENZI SAYS; MARK-UP SCHEDULED Washington, D.C. - U.S. Senator Mike Enzi (R-WY), Chairman of the Senate Health, Education, Labor and Pensions Committee (HELP Committee), today announced a landmark agreement between key stakeholders on a broad-ranging health insurance bill to provide more affordable health insurance options to America’s small businesses and working families - and confirmed that the Committee will markup up the bill next week. “Working with a diverse group of Senators and business groups representing small business, we’ve bridged the gap between small business proponents of traditional AHPs and state-based interests worried about the prospects of dramatic regulatory changes in health insurance markets,” Enzi said Thursday. The bill is cosponsored by Senator Ben Nelson (D-NE) and Senator Conrad Burns (R-MT). Enzi has scheduled a mark-up of the bill on Wednesday, March 8th at 10 a.m. in the HELP Committee. Senator Nelson said: “If we don’t do something to help small businesses cope with the costs of health care, soon we will have an entire workforce without health insurance coverage. Health care premiums are experiencing double-digit growth annually; small businesses can’t keep up with the costs. As a result, fewer employers are offering health coverage and fewer employees are covered. The continuing problem of skyrocketing heath care costs is a grave threat to our working families. I am pleased to be working with the Chairman to finding a workable solution to this problem.” Senator Burns said: “The Health Insurance Marketplace Modernization and Affordability Act represents the best opportunity to bring affordable health insurance to small businesses in Montana and across the nation. I know this is a goal for all Senators, and I look forward to working with members from both sides of the aisle in achieving this important goal.” The bill, “The Health Insurance Marketplace Modernization and Affordability Act,” (S.1955) will allow business and trade associations to band their members together and offer group health coverage on a national or statewide basis in direct response to runaway costs that are driving far too many employers and families from comprehensive health insurance. Since 2000, for example, group premiums for family coverage have grown nearly 60 percent, compared to an underlying inflation rate of 9.7 percent over the same period. Designed to enhance the market leverage of small groups as well as individual policy holders, “The Health Insurance Marketplace Modernization and Affordability Act” will: give associations a meaningful role on a level playing field with other group health plans; streamline the current hodgepodge of varying state regulation; preserve the primary role of the states in health insurance oversight and consumer protection; make lower-cost health plan options available; and achieve meaningful reform without a big price tag. “We are nearing almost five years of double-digit growth in health insurance premiums – increases that have repeatedly exceeded more than five times the rate of inflation,” Enzi said. “This inflationary spiral is lowering the quality of life for countless families and hurting our economy. But those hardest hit are America’s small businesses and families outside of employer-provided insurance. Never before has there been a more urgent need to encourage market reforms like those proposed in this bill.” It responds to pleas from small business trade groups to be allowed to pool their members and provide group health insurance, called Small Business Health Plans (SBHPs) under the Enzi bill, but will also include safeguards to protect against adverse effects that could result if new group plans were given a blanket exemption from consumer protections available under state laws and regulations. Enzi praised the support of Senator Nelson and Senator Burns, the bill’s cosponsors, saying: “I’m pleased to be joined by my colleagues, Senator Nelson and Senator Burns. They bring invaluable experience to this effort and I am grateful for their commitment to this issue.” He also praised the cooperation of Senator Olympia J. Snowe (R-ME), Chair of the Senate Committee on Small Business, and Senator Jim Talent (R-MO), who have been working for years to give more affordable health insurance options to America’s small businesses. “I want to thank them for their constant efforts,” Enzi added. “We owe them thanks for never losing sight of that important goal.”

President Bush Signs Legislation Reversing Medicare Physician Fee Cuts

Arlington, Va.- President Bush signed legislation yesterday that not only reverses the current 4.4 percent Medicare physician payment reduction, which went into effect on the first of year, but will also provide automatic reprocessing of claims retroactive to Jan. 1, 2006. The legislation was included in the Deficit Reduction Act. “The ACA is extremely pleased that Congress has halted the current cut in physician Medicare payments and that they have made the change retroactive,” said ACA President Dr. Richard G. Brassard. “The return to the 2005 rate is at least partial recognition by Congress that health care providers face significant challenges in today’s practice environment.” The Centers for Medicare & Medicaid Services (CMS) said it expects contractors to begin paying new claims using 2005 rates within two days of the legislation’s enactment. In addition, doctors of chiropractic will not need to resubmit existing claims submitted between Jan. 1 and Feb. 8, 2006. Contractors will automatically reprocess any claims that used the rates effective as of Jan. 1, 2006, and will instead use the zero percent update retroactive to Jan. 1. CMS estimates contractors should be able to reprocess all claims by July 1, 2006. Providers will receive retroactive payment for the differential in a lump sum. Physician fee schedule amounts are determined by regulation and the only way they can be changed is through legislation; this puts the issue in the hands of Congress. In late 2005, Congress evaluated the issue, but technical amendments in the Senate prevented final action on this critical issue until this week. CMS, recognizing that the physician payment adjustment could increase beneficiaries’ co-payments and deductibles for previously billed services, has suggested to the Department of Health and Human Services (HHS) that if a beneficiaries’ co-pay changed on Jan. 1, 2006, a physician waiver of the amount now owed by the beneficiary should not be considered inducement. More information will be available on the ACA Web site once a final decision has been made by HHS. “The ACA will continue to lobby on behalf of its members for fair reimbursement of Medicare services. It is imperative that Congress and HHS develop a permanent solution to the physician fee schedule because those most affected by this annual dilemma are not doctors, but patients,” said Dr. Brassard. Therapy Caps For most doctors of chiropractic – with the exception of those DCs participating in the Medicare Demonstration Project – coverage of chiropractic services is specifically limited to treatment by means of manual manipulation of the spine. However, the ACA has received numerous questions concerning therapy caps. With language included in Deficit Reduction Act, the President also authorized the Centers for Medicare and Medicaid Services (CMS) to develop a new exception process for Medicare beneficiaries to apply for medically necessary therapy services if their treatment is expected to exceed the $1,740 cap in 2006. The ACA will provide more information as it becomes available on its web site.


New comp bill introduced by New York Gov.

On Tuesday, Gov. George E. Pataki introduced the 2006-2007 budget for New York State which includes a comprehensive workers compensation reform. The bill would amend the workers' compensation law, the executive law and the insurance law, in relation to compensation claims. To read the proposed WC bill click on the link below.


MVP Health Care and Preferred Care Complete Merger

Two upstate New York based health plans, MVP Health Care of Schenectady and Preferred Care of Rochester, announced today that their proposed merger has been completed creating a major new plan serving three quarters of a million members across upstate New York, Vermont and New Hampshire. "The regulatory and legal steps needed to conclude the merger have been completed, and during the months ahead MVP and Preferred care coworkers will be working together to combine two great health plans into one plan that will be a 'leading player' in the Northeast," said David W. Oliker, president and CEO of MVP Health Care. "I want to reassure current MVP and Preferred Care customers that they will not see any changes in day to day operations as a result of this merger, customers will call the same telephone numbers they've always called, talk to the same people they've always talked to, and see the same doctors and health care providers as they did prior to the merger," said Lisa Brubaker, MVP Health Care executive vice president for Rochester operations, and government programs. "The combination gives us the resources to make needed investments in technology to meet the needs of our customers and providers," she said. The company said: • Members of the two plans will see no change in their products and services; • Members, employers and providers will continue to call the same telephone numbers and work with the same people from the same offices across the new combined service area; • Jobs across the new service area will be preserved; • The new combined organization will continue to operate as a not-for-profit. Its board of directors will be a combination of current MVP and Preferred Care directors; • MVP Health Care president and CEO David W. Oliker is the president and CEO of the combined company, which will continue to operate as both MVP Health Care and Preferred Care. During meetings with employees in both Rochester and Schenectady, Oliker outlined his goals for the combined company including: -- A provider network stretching from Rochester to New Hampshire that will be seamless for members and employers. -- Product offerings that will combine the best of both MVP and Preferred Care products and that can be sold throughout the expanded market area. -- Expansion of Preferred Care Medicare programs into several MVP counties. In addition to Oliker, other members of the senior management team for the combined company are drawn from both company's management teams. Lisa Brubaker, Preferred Care senior vice president and chief operating officer will assume the newly created position of MVP executive vice president, Rochester operations and government programs. Thomas Combs, Preferred Care senior vice president and chief financial officer will become executive vice president and chief financial officer of MVP. David Field, MVP chief financial officer and chief operating officer will be the executive vice president and chief operations officer for the combined company. Dennis Allen, M.D, MVP executive vice president and chief medical officer; will have the same role in the combined company. Scott Averill, MVP executive vice president and chief marketing officer will be the chief marketing and sales officer for the combined company. Denise Gonick, Esq., MVP executive vice president and chief legal officer will hold the same position in the combined company. "These executive vice president appointments reflect a blending of the talent of the two organizations," Oliker said. This is a leadership team that will make MVP the perfect example of a well-managed and successful, regional health benefits company," Oliker said. The combined company's service area covers upstate New York, the Hudson Valley, the entire state of Vermont and southern New Hampshire.

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Appeals Court Overturns Adverse District Court Ruling; The Fight Continues

ACA’s HHS Lawsuit Continues to Reap Benefits for Chiropractic Profession (Arlington, Va. - Dec. 14, 2005) The U.S. Court of Appeals has reversed a lower court decision allowing medical doctors and osteopaths to perform “manual manipulation of the spine to correct a subluxation” on Medicare beneficiaries, paving the way for chiropractors to pursue further hearings on the issue under a new administrative review process enacted in 2003. The Dec. 13 decision represents a major step in the American Chiropractic Association’s (ACA) landmark lawsuit against the U.S. Department of Health and Human Services (HHS) and comes at a critical time as millions of Medicare patients are choosing Medicare managed care plans as part of their new prescription drug benefit. “The ACA is extremely pleased that the District Court’s ruling allowing M.D.s and D.O.s to provide a uniquely chiropractic service was nullified,” announced ACA President Richard Brassard, DC. “We are happy that the issue is now whether or not a practitioner is ‘qualified,’ not whether or not a practitioner is simply licensed. The ACA’s position has been and remains that only chiropractors are qualified by education and training to correct subluxations. Because of the appeals court’s decision, chiropractors can continue to fight to safeguard their right to be the sole providers of this service and to ensure Medicare patients’ rights to access doctors of chiropractic.” In its Dec. 13 opinion, a three-judge appeals panel overturned an Oct. 14, 2004 District Court ruling that stated: “The court will simply reiterate its conclusion that 42 U.S.C. 1395x(r) does not prevent doctors of medicine and osteopaths from performing a ‘manual manipulation of the spine to correct a subluxation.’” The appeals panel ruled that the District Court lacked the jurisdiction to make this decision and that the final decision must be made through a newly revised appeals process. Through this process, individual chiropractors file complaints on behalf of their Medicare patients through the managed care organization. From there, complaints move to an administrative law judge. The appeals panel further questioned the District Court’s opinion on the issue of which health care providers are qualified to provide the chiropractic service – not simply which providers have a license to do so. “The regulation states that ‘[I]f more than one type of practitioner is qualified to furnish a particular service, the HMO ... may select the type of practitioner to be used.’ ... (emphasis added). The HMO’s invocation of this provision would squarely present the question of whether medical doctors and osteopaths, as well as chiropractors, are ‘qualified to furnish’ the service of manual manipulation of the spine to correct a subluxation.” According to ACA’s legal team, this language suggests that simply possessing a medical or osteopathic license will not be sufficient to provide the chiropractic service; the MD or osteopath must prove that they are qualified to do so by education and training. “The appeals court decision is especially significant as seniors are being encouraged to join Medicare managed care programs in which they will find no meaningful chiropractic services,” added Dr. Brassard. “Doctors of chiropractic nationwide must familiarize themselves with the new appeals process and report on any Medicare HMO that does not offer chiropractic services through doctors of chiropractic.” The ACA is exploring ways it can assist individual doctors of chiropractic through the administrative review process and provide them with the resources and materials they need to establish their unique qualifications to an administrative law judge, if necessary. Earlier court rulings in ACA’s lawsuit against HHS, filed in 1998, have also resulted in “monumental victories for Medicare patients,” according to Dr. Brassard – the most important being the decision prohibiting physical therapists from providing manual manipulation of the spine to correct a subluxation to Medicare patients. “Before ACA filed its lawsuit,” Dr. Brassard explained, “Medicare HMOs were given the green light to misappropriate taxpayer dollars to pay non-physician physical therapists to deliver the chiropractic physician service of 'manual manipulation of the spine to correct a subluxation’ under Medicare – or to deny the service to beneficiaries altogether. That unfair and illegal practice has ended as a direct result of our lawsuit.” Other victories that occurred as a direct result of the HHS lawsuit were: The preparation and release of a government study showing the virtual elimination of chiropractic services to Medicare beneficiaries entering the Medicare Managed Care system where there is a medical doctor gatekeeper requirement; And, a government mandate that all Medicare Managed Care plans must make available and pay for manual manipulation of the spine to correct a subluxation. “The ACA and the National Chiropractic Legal Action Fund (NCLAF) thank the thousands of supporters and contributors who have stood with us through this monumental legal battle,” said Dr. Brassard. “Because of your commitment, we will continue to work together to ensure that Medicare beneficiaries receive the safe and effective chiropractic care they need and deserve.” For a copy of the Dec. 13 decision, additional information on Medicare managed care plans, and resources on the Medicare administrative review process, visit ACA’s Web site at:



Over Thirty Charged in Scheme to Bilk Insurance Companies of $12M Westchester County District Attorney Jeanine Pirro was joined by New York State Police Major Frank Koehler, Yonkers Police Commissioner Robert Taggart, Westchester County Police Commissioner Thomas Belfiore, New York City Police Department Deputy Inspector Alan Cooper, New York State Insurance Frauds Bureau Director Charles Bardong, the National Insurance Crime Bureau, the New Jersey Attorney General’s Office and numerous insurance carriers to announce the results of a three-year investigation into the systematic fraudulent billing of no-fault accident claims by a major medical mill operating in Westchester County. It is alleged that Elm Street Medical, PC operating out of One Elm Street, Tuckahoe, New York, bilked insurance companies by exploiting the no-fault provisions of the New York State Comprehensive Motor Vehicle Insurance Reparations Act. (This act entitles persons injured in automobile accidents to a minimum of $50,000 of medical coverage regardless of who is at fault.) Over a period of approximately three years, Elm Street Medical bilked dozens of insurance companies by upcoding (i.e. the submission of claims containing codes for expensive medical services never provided) or by submitting bogus claims for medical services on behalf of patients who had not been in a car accident. Elm Street’s physicians would routinely recommend numerous tests or treatments including physical therapy treatment; chiropractic services; dental evaluations, testing and treatment; orthopedic evaluations; psychiatric evaluations and treatment; psychological evaluations and treatment; neurological evaluations and testing; durable medical goods; and excessive diagnostic testing all provided for at the Elm Street facility. Some of the procedures that were billed for were never performed and others were shams. Additionally, a simple five minute procedure would be routinely upcoded and billed for a more complicated and longer higher reimbursement procedure. All of the patients were required to assign all insurance payments to Elm Street. Patients also received a promise of proceeds from any potential lawsuit as a result of their injuries. In order to further the operation, LEONARDO VELEZ, an emergency room employee at Saint Joseph’s Hospital in Yonkers and BARRY SUAREZ, a paramedic employed at Empress Ambulance Service, forwarded confidential patient information about individuals involved in accidents from numerous Westchester County hospitals to co-defendant BRUCE NIXON. Nixon, posing as a doctor or hospital patient care coordinator, would refer these patients, most of whom were in minor fender bender accidents, for unnecessary follow-up medical treatment at Elm Street. Nixon would make approximately $1,500 for each referral. Another defendant, JEAN RICHARDSON, actively participated in this criminal enterprise by setting up fictitious accidents. It is alleged that Richardson, while a shelter director at Westhab, Inc., a non-profit organization that administers the daily operation of Westchester County’s homeless shelter system, used Westhab employees and residents to pose as injured car accident victims for the purpose of creating false insurance claims. Not only did uninjured Westhab residents and employees pose as injured patients, but they were also shuttled to the Elm Street offices in official Westhab vans. Richardson is no longer employed by Westhab, Inc. The Elm Street Enterprise, through its office managers, ALEXANDER KARSHENBOYM and SERGEY CHIZHOV, paid runners (recruiters), including, BRUCE NATHANIEL NIXON, JEAN RICHARDSON and others, to steer claimants to medical clinics owned and operated by the Elm Street Enterprise. The runners paid BARRY SUAREZ and LEONARDO VELEZ, and others to steal confidential patient information to permit the runners to contact the patients and turn them into claimants at the medical clinics owned by the Elm Street Enterprise. Many of these claimants had been in real, but minor automobile accidents. Others, such as ROBERT WECHSELBLATT and runner JEAN RICHARDSON, were not in automobile accidents, but knowingly permitted their names and pedigree information to be placed on fictitious accident reports and thereafter told insurance carriers and others that they had been involved in actual automobile accidents. In order to legitimatize the false insurance claims submitted by the Elm Street enterprise, it is alleged that SHARON DAVIS, a former New York City Police Department Administrative Aide, and LORETTA STOKES, a former New York City Police Department Administrative Aide, assisted in the creation of forged police accident reports by knowingly entering false data about fictitious accidents into the New York City Police Department database, so that an accident report number could be assigned. These defendants received up to $300 per report for their criminal activity. They are charged with Criminal Facilitation in the Fourth Degree. The enterprise also included corrupt medical professionals and staff employed by the Elm Street Enterprise, including VLAD MEISHER, MD; JOHN GELFAND, MD; YEFIM SOSONKIN, MD; TOBIAS SHKLOVER, MD; HERBERT FENTON, DDS and others, purportedly rendering and providing medical treatment to these claimants and creating reports documenting the services they purportedly provided. The fraudulent reports and claims submitted to insurance carriers detailed fictitious, unnecessary and/or underperformed medical visits and procedures as well as treatment contrary to generally accepted medical practice. On June 23, 2004, the Westchester County District Attorney’s Office, the New York State Police, and the New York State Insurance Frauds Bureau executed three search warrants resulting in the seizure of hundreds of patient files from the Elm Street Medical offices. It is believed that the Elm Street operatives received over $12 million dollars during a five year period from 1999 to 2004 as a result of running this criminal enterprise. Of the 34 charged, fourteen (14) individuals and six (6) corporations were indicted. All twenty (20) indicted defendants were part of the Elm Street enterprise operating to defraud insurance carriers through the submission of fraudulent no-fault automobile claims. Those indicted were ALEXANDER KARSHENBOYM; SERGEY CHIZHOV; ELLA CHIZHOV; VLAD MEISHER, MD; JOHN GELFAND, MD; TOBIAS SHKLOVER, MD; YEFIM SOSONKIN, MD; HERBERT FENTON, DDS; BRUCE NATHANIEL NIXON; BARRY SUAREZ; LEONARDO VELEZ; JEAN RICHARDSON and ROBERT WECHSELBLATT. One indicted individual remains at large. Corporate summons were also issued for six corporations owned and operated by the enterprise; ELM STREET MEDICAL, PC; ELM NEUROLOGICAL CARE, PC; COMPAS MEDICAL, PC; BOGART AVENUE MEDICAL, PC; ANDA MANAGEMENT CORPORATION; and ALL-SHURE CORPORATION. Moreover, the following 14 individuals were arrested and charged by felony complaint: ANDREW CHEVANNES, ALLAN BAILEY, SHEENA GRAVES, KEVIN GOEFF, GISELLE RIVAS, ROSE ORTIZ, VINCENT JENKINS, LEON AKERY, SHARON CLARK, ANDRE CABAN, KEN COLEMAN, DENISE AHMAD, IBRAHIM AHMAD and PATRICIA TERRY. The investigation is continuing. Among the crimes charged against defendants are Enterprise Corruption, Insurance Fraud in the First Degree and Money Laundering in the First Degree, all class “B” felonies, as well as Insurance Fraud in the Second Degree and Grand Larceny in the Second Degree, class “C” felonies. If convicted, those defendants charged with class “B” felonies face a maximum of twenty-five years in state prison. District Attorney Jeanine Pirro thanked the following insurance companies for their investigative assistance: Allstate, GEICO, Liberty Mutual, Nationwide, Countrywide, State Farm, Progressive, One Beacon and AutoOne. DA Pirro also thanked Lawrence Hospital, the Westchester Medical Center, Saint Joseph’s Hospital, Saint John’s Riverside Hospital, Mount Vernon Hospital, Sound Shore Hospital, Empress Ambulance Service and the NYPD Fraudulent Accident Investigation Unit. DA Pirro also thanked the New York State Motor Vehicle and Insurance Fraud Prevention Board for their assistance. -END – In compliance with Disciplinary Rule 7-107A of the Code of Professional Responsibility, you are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.

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Challenges in Manufacturing Sector Emphasizes Need for Dramatic Reforms Plan Strikes Balance by Reducing Costs for Businesses and Increasing Benefits for Injured Workers Governor George E. Pataki today proposed a comprehensive plan to reform New York’s Workers’ Compensation system by reducing costs for businesses while increasing benefits for injured workers. The new measures proposed by the Governor would further improve New York’s business climate, expand the State’s job-creation efforts and keep New York business -- especially manufacturing-based business -- competitive in the global marketplace. The Governor’s plan would reduce Workers’ Compensation costs for businesses by more than 15 percent, while increasing benefit levels for injured workers by 25 percent. The new reforms come on top of the historic workers’ compensation reforms the Governor fought to achieve in 1996 that have already reduced costs by 25 percent on average. The Governor proposed a series of additional reforms to the workers’ compensation system in 2004, but the Legislature failed to act on them. “Whether it’s cutting taxes, eliminating unnecessary regulations or reducing workers’ compensation costs, we know that lowering the cost of doing business is a proven way to create new jobs and that’s exactly what we’ve done in New York during the past 11 years,” Governor Pataki said. “In 1996, we worked together to achieve historic and long overdue reforms to the Workers’ Compensation system, which have already reduced costs for businesses by 25 percent. But Workers’ Compensation is one of the biggest costs for businesses and if left unchecked can be an impediment to creating new jobs.” “We’re working hard to help manufacturing-based businesses, such as Delphi in Western New York, stay competitive in the global economy and protect thousands of New York jobs, and these new reforms mark another step in those efforts,” the Governor said. “These new reforms strike a balance between controlling costs for those who create jobs – businesses -- with the needs of workers who risk their health and safety to provide for their families and keep New York’s economy growing. “The time to act is now. I urge the Legislature to work with me to enact these important reforms so that we can help New York businesses better compete, protect tens of thousands of jobs across the State and ensure benefits for injured workers,” the Governor added. The Governor’s plan would reduce workers’ compensation costs for businesses by 15 percent by creating a system of tiered benefit levels for injuries that are not currently scheduled under the law, reducing litigation, better coordinating anti-fraud efforts and authorizing comprehensive fee schedules for medical goods and pharmaceuticals. It would also increase benefit levels for workers injured on and off the job, increasing the maximum weekly indemnity benefits paid to injured workers by 25 percent from $400 to $500 per week. Daniel Walsh, President of the Business Council of New York State said, “We welcome this new initiative by Governor Pataki to craft a comprehensive workers' compensation package which recognizes the many inequities in the current comp system. Taken as a whole, this initiative will help employers of all sizes and types, particularly those in New York's manufacturing community. We look forward to working with the Governor and the Legislature in a good faith effort to bring the comp system more in line with that of our competitor states.” Randy Wolken, President of the Manufacturing Association of Central New York said, “It is imperative that New York realizes the impact workers comp costs truly have on employers, and our competitiveness with other states. The recent premium increase particularly impacts manufacturers; with MACNY members reporting increases of 15-29% since October 1st. Last year closed without a resolution to New York’s workers comp crisis. Now, more than ever, it is crucial to resolve this issue, and move forward on meaningful reform. We look to work with the Governor, the Legislature, labor, and others on this crucial issue to preserve high-paying manufacturing jobs in New York.” Andrew J. Rudnick, President & CEO, Buffalo Niagara Partnership, said, “For upstate employers, especially in manufacturing, workers comp costs are a particularly heavy burden. The Governor's proposed reforms go a long way to relieve that burden, and increased investment and jobs should be a direct result.” Mark Alesse, New York State Director of the National Federation of Independent Business said, "Governor Pataki’s exciting new Workers’ Compensation reform bill is welcomed news for the state’s 1.5 million small businesses and their workers. If the Legislature passes this initiative, worker benefits will rise, and overall Workers Comp costs will drop, fostering new employment growth.” Workers’ Compensation Board Chairman David P. Wehner said, “These reforms strike a balance between controlling costs and the needs of workers --addressing the major concerns of both the business and labor community. The Governor clearly understands that while New York must support injured workers, we must also keep our economy strong. We can fulfill and balance these obligations without piling unnecessarily high workers’ compensation rates on our businesses.” The Governor’s plan generates savings of more than 15 percent by reducing frivolous claims against the Second Injury Fund, expanding the Alternate Dispute Resolution program to include the unionized manufacturing sector and by joining 37 other states that have created a system of tiered benefit levels for permanent partial disabilities. Specifically, the Governor’s proposed legislation also addresses the following issues: PROTECTING INJURED WORKERS ● - Authorizes the phasing in of the first workers’ compensation benefit increases for workers injured on-the-job and their beneficiaries in New York State since 1992. ● - Authorizes a 100 percent increase in the maximum disability benefit for workers injured off-the-job (Disability Benefits) from the current $170 maximum to a maximum of $340. ● - Enables workers to protect themselves better by allowing for supplemental benefits in amounts up to two-thirds of their average weekly wages. ● - Allows claimants to receive non-emergency medical procedures costing less than $1,000 without prior insurer authorization. Currently injured workers must seek authorization before any non-emergency procedure over $500. ● - Requires employers to file an injury report (C2) to their carrier within 3 business days of notification of injury and to the Board within 5 days. ● - Requires that carriers or self insured employers provide the injured workers the option of a Section 32 settlement agreement on all claims. ● - All claims that are unresolved within one year or controvert will be transferred to the expedited hearing calendar giving this claim a higher priority status. ● - Requests for discretionary Full Board Review (Appeals) must be filed within 30 days and imposes a fine of $500 on employers, carriers or claimant representative for filing frivolous appeals. ● - Requires the Board to schedule a pre-hearing conference within 45 days upon learning that a claim is disputed. ● - Expands the successful “payment without prejudice” provision to include prescription medicines. Under this program, insurers may provide benefits for up to one year while a case is litigated, without admitting liability. ● - Accelerates the delivery of benefits to injured workers by enhancing the conciliation process to lessen potentially lengthy litigation. REDUCING COSTS FOR EMPLOYERS ● - Reduces employer assessment for the Second Injury Fund by more than $190 million by adjusting the calculation used to determine the assessments from 150 percent of the previous year’s disbursements to 115 percent. ● - Expands the Alternate Dispute Resolution (ADR) program to include the unionized manufacturing sector. Currently only unionized construction can utilize this cost savings program that enables employers to reduce litigation and trim costs by resolving claims outside of the workers’ compensation system under rules that are collectively bargained. ● - Establishes a Pilot Program to encourage the voluntary delivery of compensation and medical benefits to injured workers without intervention by the Board, but subject to the Board’s supervision. ● - Enacts savings by creating a tiered system with regard to the duration of benefits for permanent partial disabilities (PPD). This system would provide for benefits to be coordinated with the severity of an individual’s disability. (An independent study of New York’s workers’ compensation system conducted in 2001 by the Workers’ Compensation Research Institute concluded that New York’s average indemnity cost per PPD claim is 110 percent above the median state.) ● - Establishes a medical committee to develop objective medical criteria for determining the level of impairment sustained by injured workers. • Reduces the assessment for the Second Injury Fund by initiating a $250 filing fee for carriers or businesses seeking reimbursement from the Fund, of which $200 is returnable if the carrier/employer is successful in its claim for reimbursement. ● - Directs the Chair of the Workers’ Compensation Board to adopt a schedule of maximum fees allowable for prescription medicines and durable goods such as prosthetic devices, and requires that generic medicinal equivalents be used whenever possible. ● - Deems ineligible for benefits, all persons incarcerated and convicted of a crime. ● - Enables carriers or self-insured employers to contract with a network or networks to perform diagnostic tests, x-ray examinations, MRI’s or radiological exams and require claimants to use facilities within that network (except in emergency cases), giving employers greater control over medical costs. ● - Amends the Executive Law, the Insurance Law, requiring the Workers’ Compensation Board Fraud Inspector General, the State Insurance Department’s Insurance Fraud Unit and the State Insurance Fund’s fraud investigations unit to work with increased collaboration, including quarterly meetings to coordinate enforcement efforts. Workers' compensation is a no-fault wage replacement and health care benefit system that serves workers who are injured on the job. Payments of benefits are the responsibility of the injured worker's employer who is required by law to obtain insurance or self-insure to cover the costs of workers' compensation benefits. The Workers’ Compensation Board maintains permanent jurisdiction over injured worker claims whether they are opened or closed.

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Chiropractic Coverage Expanded Under Federal Employee Plan Benefit for 2006

The Federal Employee Plan Benefit for 2006 has been updated. These updates include expanded chiropractic coverage under the Standard Option Plan. Previously under the Standard Option there was no benefit for spinal manipulation. Attached please find the details of the new 2006 benefit. Under the Standard Option, benefits may be provided for covered services in a Medically Underserved Area as long as they are within the scope of licensure. American Chiropractic Association Kara Murray Project Manager Office of Professional Development and Research 800.986.4636 ext. 242 703.243.2593 (fax)

WellPoint Inc. to buy WellChoice Inc.

WellPoint, Inc. (NYSE: WLP) and WellChoice, Inc. (NYSE: WC) jointly announced today that they have signed a definitive merger agreement whereby WellChoice would operate as a wholly owned subsidiary of WellPoint. The transaction brings together WellChoice, the parent company of Empire Blue Cross Blue Shield, the largest health insurer in the State of New York, and WellPoint, the nation's leading health benefits company. The combined company will now serve more than 33 million medical members as a Blue Cross or Blue Cross Blue Shield licensee in 14 states and through its HealthLink and UniCare subsidiaries. "This merger brings together two very strong companies focused on providing consumers with the best possible value in health benefits," said Larry C. Glasscock, president and chief executive officer of WellPoint. "Additionally, both companies share the strength and tradition of the Blue Cross Blue Shield brand, one of the most trusted brands in America." "Our companies also share a vision of improving health care," Glasscock said. "Together, we can make that vision a reality by continually developing innovative products that meet customers' needs, by enabling consumers to make better informed health care decisions, and by working collaboratively with hospitals and physicians to improve quality and safety. In doing so, we will help hold down the rising cost of health care." "While premiums must keep pace with rising health care costs, we can assure our members in all of our states that this merger will not add in any way to premium increases," Glasscock added. "Both WellPoint and WellChoice have strong track records of reducing administrative costs while improving customer satisfaction. The synergies we can achieve through this merger, along with the ability to spread administrative costs over a larger membership base, will contribute to our ongoing efforts to keep premiums affordable for customers. Because both WellChoice and WellPoint believe that all health care is local, our merger provides that WellChoice customers will continue to be served by the same local health plan they know today, with decisions made by local management based in New York City." After the close of the transaction, Michael Stocker, M.D., president and chief executive officer of WellChoice, will become president and chief executive officer of a newly combined Northeast Region of WellPoint. As such, Dr. Stocker will have responsibility for business operations in New York, Connecticut, New Hampshire and Maine. He will serve on WellPoint's Executive Leadership Team and report directly to Glasscock. The headquarters for the Northeast Region will be located in lower Manhattan. "This transaction serves the best interests of all our important constituencies and we are very pleased to become part of an enterprise that shares our vision and focus on quality health care at an affordable price," said Dr. Stocker. "Our customers will experience no disruption, and there will be no changes in our networks or benefits as a result of the merger. When combined, our companies will be ideally positioned to promote preventative health care, to engage consumers in maintaining their own good health, and to make the investments necessary to lead positive change in our country's health care system. At the same time, we will be able to draw upon the resources of the nation's leading health benefits company to serve our customers even better." Glasscock added, "It is more important today than ever before for companies to be socially responsible and actively involved in helping make their communities better places to live and work. Both WellChoice and WellPoint have long histories of significant charitable contributions and community involvement, and combined, our role in the community will be even more effective." The merger will strengthen WellPoint's leadership in providing health benefits to National Accounts - large employers with multi-state operations. New York City is the headquarters of more Fortune 500 companies than any other U.S. city, and the merger gives WellPoint a strategic presence in this important market. Both companies have achieved growth among large national employers, building on the strength of the Blue brand and its broad national networks of physicians and hospitals. With Blue plans in 14 states, the combined company can offer large national employers leading local presence in more markets than any other health benefits company. The merger will also enhance the combined company's ability to offer consumer-driven health solutions, which are a growing choice of consumers and employers alike. In June, WellPoint acquired Lumenos, a pioneer and leader in consumer-driven health plans, and WellChoice has incorporated Lumenos technology into its Empire Total Blue consumer-driven product. "Our recent acquisition of Lumenos, combined with WellChoice's successful deployment of Lumenos features in Empire Total Blue, will allow us to immediately offer Lumenos' full product line to new and existing National Accounts headquartered in WellChoice's service area," Glasscock said. Both companies believe that maintaining a strong local presence is very important in the delivery of health benefits, and that philosophy will continue with the merger. In addition, opportunities for professional growth could be created for employees of both WellPoint and WellChoice as a result of the merger. This transaction is expected to be neutral to 2006 earnings per share and accretive thereafter. At least $25 million in pre-tax synergies are expected to be realized in 2006 and approximately $50 million in 2007, with annual pre- tax synergies of at least $125 million expected to be fully realized on an annual basis by 2010. The transaction is structured as a merger of WellChoice, Inc. with a wholly owned subsidiary of WellPoint and is intended to be tax free with respect to the WellPoint stock to be received in the transaction by WellChoice stockholders. The consideration of $77.23 per share to be received by the stockholders of WellChoice will be comprised of $38.25 in cash and WellPoint stock at a fixed exchange ratio of .5191 of a share of WellPoint stock for each share of WellChoice stock (valued at $38.98 per share at the market close on September 26, 2005). The transaction will be accounted for under the purchase method of accounting. The New York Public Asset Fund, which currently owns approximately 52 million shares of WellChoice common stock, will receive approximately $1.989 billion in cash and approximately 27 million shares of WellPoint common stock from the merger based on Monday's closing stock price. The New York Public Asset Fund has agreed to vote its shares, representing approximately 62% of the outstanding shares of WellChoice, Inc., in favor of the transaction. The transaction will be subject to customary closing conditions, including approval of WellChoice's stockholders and various regulatory approvals. WellPoint and WellChoice currently expect the transaction to close in the first quarter of 2006.

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Nearly $285 Overbilled for Chiropractic Work Under Medicare

According to the Inspector General (IG) report, the government overpaid nearly $285 million in 2001 for chiropractic services. To prevent abuses, the IG recommends that caps should be placed on the number of treatments a chiropractor could bill Medicare. The ACA said that the government instituted new procedures last year to help Doctors of Chiropractic avoid improperly billing Medicare, nothing that the IG’s data cited is four years old. To examine the IG’s report click on the link below:

Insured But Not Protected: How Many Adults Are Underinsured?

ABSTRACT: Health insurance is in the midst of a design shift toward greater financial risk for patients. Where medical cost exposure is high relative to income, the shift will increase the numbers of underinsured people. This study estimates that nearly sixteen million people ages 19–64 were underinsured in 2003. Underinsured adults were more likely to forgo needed care than those with more adequate coverage and had rates of financial stress similar to those of the uninsured. Including adults uninsured during the year, 35 percent (sixty-one million) were under- or uninsured. These findings highlight the need for policy attention to insurance design that considers the adequacy of coverage. You can view the article (full text) by clicking on the link below:


ACN, ASHP and Landmark Receive Most Complaints in ACA Managed Care Data Collection Campaign

ACA Asks Doctors Nationwide for More Data into Problems Affecting Patient Care and Reimbursement (Arlington, Va) The American Chiropractic Association (ACA), as part of its ongoing aggressive campaign to correct the wrongful practices of certain chiropractic managed care networks, is asking doctors of chiropractic nationwide to provide additional information that will assist in putting an end to these practices. Among the wrongful practices that the ACA is gathering information about are the following: • Automatic downcoding or limiting physician discretion in the planning of care: The doctor submits the network's forms after examining the patient and is advised of the frequency, duration and type of care that will be covered. Requested treatment is often reduced or denied. Claims are downcoded without the doctor of chiropractic being provided the opportunity to provide any documentation supporting the claim as submitted. • Bundling: The submitted CPT code is incorporated into another submitted CPT code. • Improper utilization review including refusal to recognize coding modifiers: Managed care organizations sometimes refuse to recognize "modifiers" that chiropractors append to CPT codes to report a service or procedure that has been performed and which has been altered by some specific circumstance. • Performance management issues: Managed care networks often disregard the doctor's discretion to diagnose and treat, and limit the number of visits, x-rays and modalities. Doctors say they are reprimanded and threatened with the loss of their contract when the care they prescribe is outside the managed care organization's set standards. "For too long, there has been a misguided perception within the profession that ACA somehow condones the unfair practices of certain chiropractic networks," explained ACA President Donald Krippendorf, DC. "In reality, the ACA strongly denounces these practices and needs your support and information to put an end to what we view as unconscionable activity by these groups." The latest campaign to correct these harmful practices is an outgrowth of a resolution passed by the ACA House of Delegates in March 2002 formally outlining ACA's opposition to the improper practices of chiropractic networks and authorizing ACA staff to collect data identifying the types of abuses doctors of chiropractic experience at the hands of third-party administrators. As part of this effort, ACA recently retained the services of Milberg Weiss, one of the nation's largest class action law firms, to assist in the collection and analysis of this information. Over the past three years, hundreds of doctors of chiropractic have contacted ACA and completed "managed care data collection" forms detailing their troubling experiences with chiropractic networks - and the names of several specific organizations and trends have emerged. According to the data collected by ACA, doctors of chiropractic are most troubled by the actions of American Chiropractic Network (ACN), American Specialty Health Plans (ASHP) and Landmark Healthcare. These carriers routinely deny requested treatment and improperly reduce and deny reimbursement, putting patients and quality of care at risk, according to doctors who contacted ACA. ACA's data collection efforts have uncovered an array of serious concerns with these carriers, but more information is needed regarding particular problem areas. "We have heard your complaints, and we are further analyzing our options to deal with these activities," added Dr. Krippendorf. "We need your continued support and information to protect not only your practice and profession, but also the quality of care you provide your patients." In addition to canvassing the chiropractic profession for more data into specific problem areas, the ACA is also contacting certain chiropractic networks and demanding that they cease the misleading use of ACA's name and trademark in their communications and treatment forms. In a May 13, 2005, letter to ASHP President George DeVries, ACA Executive Vice President Garrett F. Cuneo demands that ASHP remove the "unauthorized and misleading reference and use of the ACA name" in the company's "Clinical Treatment Form." "Please be advised that the ACA views this unauthorized use of its name in connection with the misleading representation contained in your form as defamatory, a violation of its trademark and a continuing unfair trade practice that has resulted and continues to result in damage to the association," Cuneo wrote. The full letter can be found on ACA's Web site at: letter to American Specialty Health (ASHP). The ACA is requesting that doctors of chiropractic who have experienced problems with ACN, ASHP, and Landmark in the areas of restriction of treatment, downcoding, bundling and improper use of modifiers fill out the data collection form found on ACA's website at: CARE DATA COLLECTION FORM. Please fax the completed form to (703) 243-2593, Attention: PDR Department. Your information will be kept in strict confidence and your name will not be released to any managed care network. You will also find additional information and resources regarding ACA's data collection campaign and what you can do to assist in this effort on ACA's Web site at: Are You Having Problems with Chiropractic Networks and Managed Care Organizations? For more information: Felicity Feather Clancy Vice President, Communications [email protected] phone: (703) 276-8800, ext. 241 or Angela Kargus Communications and Public Relations Manager [email protected] phone: (703) 276-8800. ext 240


The CIGNA Settlement . . . What It Means To You

In January, health care providers, including chiropractors, psychologists, counselors, podiatrists, acupuncturists, optometrists, physical and occupational therapists, nurse midwives, nurse practitioners, nurse anesthetists, nutritionists, orthotists, prosthetists, audiologists and speecfh and hearing therapists received Notice of a proposed settlement in a consolidated class action lawsuit brought against CIGNA and several other defendant insurers by thirteen individuals and six or more state and national organizations. The settlement proposes prospective relief as well as payment of cash compensation to providers who file valid claims. Click on the link below to open a slide presentation that explains the rudiments of the proposed CIGNA Settlement and what it could mean to you. Even if you treated no CIGNA Healthcare subscribers you still could be entitled to a portion of the cash settlement. Click on the link below to open the slide presentation to find out more.