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Maryland Fines CareFirst $400,000

Feb 27, 2003 |

Maryland insurance regulators have imposed a $400,000 fine on CareFirst Blue Cross Blue Shield for violations that include wrongfully denying claims and failing to process a majority of HMO claims within 30 days.

The state charged that in one case, CareFirst denied a claim 169 days after it had been submitted. The company, which has more than 3 million members in the Washington, D.C. area, said it has corrected the problems.

The Maryland Insurance Administration conducted four "market conduct examinations" of CareFirst in 2001 and 2002. Among other things, it found that CareFirst wrongly denied claims submitted by doctors who had submitted more than one significant service during a single patient visit.

CareFirst also wrongly denied claims for "rapid strep throat" tests performed in doctors' offices. Instead, it required its BlueChoice HMO patients to go to a separate lab facility for the tests. CareFirst has since reprocessed 3,452 strep claims and paid more than $51,000, state officials said.

Other CareFirst violations included wrongfully requiring pre-authorization of pharmacy claims on some Medicare supplemental policies and allowing its pharmacy vendor to determine which prescription drug benefits would be paid.

The company blamed "rapid growth" for some of the problems.

The Maryland State Medical Society said insurers "are constantly manipulating the way they pay physician claims, and this is just one example of such activity."

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