CIGNA Fined $150,000 By New York State

Hartford Courant Staff Writer
January 25, 2006

CIGNA HealthCare has paid a $150,000 fine to the state of New York because the company failed for years to respond to many consumer complaints in a timely or adequate manner, regulators said Tuesday.

The fine is higher than what other companies, including Oxford Health Plans and Aetna, have paid New York because CIGNA's problems continued for so long, dating from at least 2002, said Michael F. Barry, director of public affairs for the New York Insurance Department.

CIGNA also agreed to take corrective action.

The department says it alleged, and CIGNA agreed as part of a stipulation, that the company "provided neither timely nor substantive responses to the written customer complaints that were referred to CIGNA via the Insurance Department's Consumer Services Bureau."

The department said it sends hundreds of pieces of correspondence each year to CIGNA's customer advocacy unit for a response or action, often involving coverage or claim issues.

New York law requires health insurers to acknowledge within 15 business days the consumer complaints sent by the department's bureau - a deadline CIGNA repeatedly failed to meet, regulators said.

"CIGNA HealthCare of New York Inc. takes regulatory compliance and our members' concerns very seriously," company spokeswoman Patricia S. Caballero said. "We are responding to consumer complaints in accordance with our corrective plan in an effort to be in compliance with all applicable New York insurance laws."

Caballero said CIGNA had made a "good faith" effort to respond to complaints. The company has assigned more people to prepare responses, and has increased oversight of its consumer advocacy unit, she said Tuesday.

Barry said his department worked with CIGNA for several years on the problem and saw "sporadic progress" and then "regression." The company, he said, cited high turnover in its complaint unit.

At the insurance department, Barry said, "There was a feeling the [CIGNA] senior management team did not feel a need to quickly resolve deficiencies in the consumer advocacy unit."

CIGNA has been working several years toward a turnaround from service problems and lagging profits.
Copyright 2006 by The Hartford Courant

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