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Arkansas-based ER staffers awarded $9.4M in insurance lawsuit

by Linda Satter | August 20, 2020 at 7:09 a.m.

A federal jury in Little Rock has awarded more than $9.4 million to an Arkansas-based group of about 175 emergency room doctors, nurse practitioners and physician assistants who jurors found were underpaid by an insurance company for services provided since 2014.

The jury award of $9,426,497 was delivered Tuesday night against Arkansas Health & Wellness Health Plan, part of Centene Corp., after seven days of trial over about two weeks, followed by four hours of deliberation. It reflects the amount that Southeastern Emergency Physicians LLC was underpaid for emergency services provided to 12,500 patients covered by the Patient Protection and Affordable Care Act.

The insurance company contended that when the Affordable Care Act took effect, a 2011 contract between the physicians group and the insurance company no longer applied. But a jury of three men and three women unanimously decided that the contract applied to a new insurance product introduced in 2014, and that the insurer breached the contract by paying the doctors 10%, instead of 75%, of regular commercial billing rates.

The doctors group "absolutely has been victimized by this greedy insurance company," attorney John Zavitsanos of Houston, Texas, said Wednesday. His firm recently joined attorneys Judy Simmons, Baxter Drennon and Michael A. Thompson of Little Rock's Wright, Lindsey and Jennings firm in representing the doctors and Team Health, which owns Southeastern Physicians and other physician groups, and provides administrative services for them.

"It's absolutely despicable that they would do this," Zavitsanos added. "These ER doctors are modern-day heroes."

Attorney Steven Cady of the Washington, D.C., law firm Williams & Connolly, which represented Centene, wouldn't comment on the case Wednesday but said he would pass a request for comment to the company. A local attorney, Lyn Pruitt of the Mitchell, Williams, Selig, Gates and Woodyard firm, which also represented the defendants, didn't return a reporter's phone call.

Zavitsanos said that when attorneys' fees and interest are added to the judgment, it is likely to total $12 million to $13 million.

Southeastern Physicians is affiliated with seven hospitals in Arkansas.

"Insurance companies can have enormous leverage over doctors," Zavitsanos said. "As profits at health insurance companies have skyrocketed, reimbursement rates for doctors have fallen off a cliff."

A lawsuit over the contract dispute was filed Aug. 2, 2017, and assigned to U.S. District Judge Kristine Baker, who presided over it for nearly three years until June 16, when the Mitchell-Williams firm, where the judge's husband is an attorney, joined the defense, requiring her recusal. It was then assigned to U.S. District Judge Brian Miller, who refused to postpone the case, citing its age, and presided over the trial on its original schedule.

The doctors' group complained at the time that the defendants purposely got the Mitchell firm involved to force Baker's recusal, hoping to delay the case and worried about her earlier rulings refusing to dismiss the case and allowing the plaintiffs to add claims, calling it a "judge-shopping gambit." But Miller refused to disqualify the Mitchell firm and return the case to Baker, saying the defendants are free to choose their attorneys.

According to a news release issued Wednesday by the plaintiffs, "this lawsuit is one of many TeamHealth has filed against various insurers across the country to stop systematic underpayment of ER doctors by insurance companies that seek to keep the money for their own coffers. ... TeamHealth is trying to level the playing field for these key doctors that support multiple communities but whose practice groups are being badly underpaid by several highly profitable insurance companies."

The plaintiffs said evidence presented at trial showed that "Centene tried to obfuscate their ownership of the companies and the entities responsible for paying the doctors."

The case is Southeastern Emergency Physicians LLC v. Arkansas Health & Wellness Health Plan Inc.; Celtic Insurance Co., doing business as Arkansas Health & Wellness; Novasys Health Inc. and Centene Corp.

Zavitsanos said Arkansas Health and Wellness is a division of one of Centene's subsidiaries, Celtic Insurance.


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