Lawsuit alleges state office overbilled
The Louisiana Office of Group Benefits has been “unwittingly’’ overbilling some state employees, retirees and their dependents who undergo outpatient procedures at a hospital or other health-care facility rather than a doctor’s office, a lawsuit that seeks class-action status and damages alleges.
Baton Rouge lawyer Mary Olive Pierson, one of the attorneys for the plaintiffs, said the suit potentially involves tens of thousands of claims.
“I think you’re talking about several million dollars,’’ she added.
The suit contends the alleged overbilling has been occurring in the Office of Group Benefits’ PPO — or Preferred Provider Organization — plan when OGB records the “place of service’’ code indicating where a procedure is performed.
“We take the issues raised in the lawsuit very seriously, and we will conduct a thorough review of the lawsuit to make sure plan members are treated fairly,’’ state Division of Administration attorney Lesia Batiste said Thursday.
A health-care provider is reimbursed at a higher rate for in-office procedures than for the same procedures performed in a hospital or other health-care facility, the suit notes.
The suit cites specific instances in 2003 and 2008 when OGB PPO plan participants underwent outpatient procedures in a health-care facility, but OGB coded the procedures as occurring in doctors’ offices.
In both instances, the PPO plan participants were required to pay amounts in excess of their co-insurance requirements because of the OGB errors, the suit says.
“As a result of this failure by the OGB to properly administer the PPO Plan, co-insurance payments made by beneficiaries for such procedures have been wrongfully inflated throughout the history of the program,’’ the suit claims.
Pierson stressed that the place of service coding done by the doctors was done correctly. The alleged errors were made when OGB processed the forms for reimbursement of service, she said.
“We are not suggesting that anything was done intentionally by OGB,’’ Pierson said.
She also noted that the suit’s allegations involve only the PPO administered by OGB and not the HMO, or Health Maintenance Organization, administered by the agency.
A PPO differs from an HMO in that, generally in a PPO, premiums are lower but there are co-pays or deductibles and a certain loss of control over choice of providers and/or place of treatment, Pierson said.
The suit, filed Jan. 12 in the state District Court, says OGB covers a combined 225,000-plus state employees, retirees and their dependents through its PPO and HMO plans. The number of participants in the PPO is about half that number, Pierson said.
Pseudonyms — Jane Doe and Susan Smith — were used for both named plaintiffs to protect them from the unnecessary and potential inadvertent disclosure of protected health care information, the suit indicates.
The suit has been assigned to state District Judge Tim Kelley.