Cigna. Joseph Pandolfo, State Compliance Manager

Transcription

1 Joseph Pandolfo State Compliance Manager Cigna Legal Cigna Routing B6LPA 900 Cottage Grove Rd. Hartford, CT Telephone Facsimile Octobers, 2018 Via, , and UPS i Steve DeAngelis Principal Examiner Life & Health Unit Market Conduct Division Connecticut Insurance Department 153 Market Street, 7^ Floor Hartford, CT Re: Cigna Health and Life Insurance Company, Docket MC Cigna Healthcare of Connecticut, Inc., Docket MC Connecticut General Life Insurance Company, Docket MC Summary of Corrective Actions Dear Mr. DeAngehs: Attached please fmd our summary of corrective actions, taken to comply with the recommendations of the Department's examination Reports of July 2, Thank you for working closely with our team to resolve the matters raised during the examination. Please contact me for questions, requests and other comments at (860) , or at ioseph.pandolfo@cigna.com. and thank you for your attention. Sincerely, Joseph Pandolfo, State Compliance Manager «iciosures

2 CONNECTICUT INSURANCE DEPARTMENT MARKET CONDUCT EXAMINATION & REPORTS DOCKET MC SECTION II (3) Cigna Health and Life Insurance Company ("CHLIC") SUMMARY OF ACTIONS TO COMPLY WITH MARKET CONDUCT REPORT RECOMMENDATIONS October 3, iiisinii: % OliMilClil SillliiliJI V ( PRODUCER LICENSING & APPOINTMENT Producers were not appointed by the respective Company within the timeframe required by. statute CHLIC producers Respective Company failed to notify the Department of an agent's termination for cause. It is recommended that-each Company review its appointment system so that no new health business is accepted from, nor commissions paid to, individual acting as agents of the Company when they not appointed as required by statute. In addition it is recommended that the procedures to insure that all terminations for cause are properly reported to the Department. The Companies will take the following steps to hirther mitigate future appointment risk driven by iuability to effectively operationalize "Just In Time" appointment processing: The Companies' Producer Compliance Team will work with our vendor, Vertafore, to modify our electronic on-boarding packets to proactively appoint, at time of contracting, all individuals and agencies with a Connecticut resident or non-resident license. Target Completion Date: December 31, ly, the Companies' Producer Compliance Team will implement a monthly process to identify and appoint any contracted individuals and agencies that newly obtain a resident or non-resident Connecticut license. Target Complete D^te: December 31, Finally, the Companies' Producer Compliance Team has implemented a process for tracking appointment timing. The ConyDanies will monitor appointment timing on a monthly basis for root cause analysis. Target Completion Date: Implemented in July Will continue to monitor.

3 ("Mii'j'orv \ MKiillL' l\l'( (I iiiiii'ii*. imdii Siiiiiiiii'rv oi \i tioii In 2016, the Companies developed new policies, procedures and termination letter templates with regard to all terminations, including terminations for cause. Since that time, any true for cause terminations are reviewed and processed by the Companies' Producer Compliance Senior Specialist who ensures notifications are sent to both the producer and the state. To prevent errors in termination selection, the Companies have removed the option for someone to select for cause as a termination reason in Vertafore's Sircori Producer Database. The Producer Compliance Senior Specialist now places for cause appointment terminations directly through the National Insurance producer Registry. UNDERWRITING AND RATING - Concern Company was unable to provide policy termination files for regulatory review. 3 - CHLIC group policies 22 - CHLIC individual policies Companies review their underwriting policies and procedures to ensure that sufficient documentation is maintained for regulatory review. Group Policies The Companies' Sales Effectiveness Team on July 2, 2018 issued revised process guidance and an educational reminder to Sales staff, reinforcing maintenance of group policy termination files. Guidance revision provided to Sales staff: It is critical for Sales to retain copies of the cancellation letter provided by the client or broker. Copies ofthe cancellation letters are required to be stored in SFDC under the notes/attachments view to comply with Market Conduct and avoid fines and penalties. ly, the Companies' Sales Business Compliance Team will begin testing Group Termination Letter Retention at the end of third quarter 2018 for 9/1/2018 and 10/1/2018 policy termination dates. Individual Policies The Company's Quality Audit Team in April 2017 implemented an automated termination letter process, supported by control reports and review of weekly termination reports to ensure letters are generated.

4 f'.di (';> ( ii'i-ilioii Suiii is.u ^.'.1 Monthly quality council sessions include focus on letter audits in which root cause analysis on errors is provided, and review of corrective action plans supporting improvements. Improvements through 2017 included new training, audit and coaching delivery methods, and development in late 2017 of additional controls with the Companies' IntemalAudit teamto ensure ongoing oversight of this item. ly, the Companies revised their contract with a letter generation vendor effective 1/1/2018 to include service level penalties if required letters are not generated, inaccurate or delayed. A statistical sample, based upon membership, is audited monthly. CLAIMS CLAIMS - Concerns: Delegated Vendor Claims The examination found a combined twenty thousand eight hundred ninety (20,890) claims that were not paid within statutory timeframes for which required interest was paid. A combined one thousand four hundred two (1,402) claims were not paid within statutory timehames where interest was owed (CHLIC, CHC CT, CGLIC). Several instances where claims were denied rather than forwarded to delegated vendors. (CGLIC, CHLIC). Companies review their claim handling procedures to ensure that all claims are investigated and resolved pursuant to required claim settlement practices. procedures to ensure that claims are all properly invesitgated and resolved pursuant to required claim handling requirements. The Department, in prior examination reports, had concerns over the number As referenced in the Report the deficient claims were remediated to pay apphcable interest. The Companies' analysis of examined claims, and review of claim handling procedures determined that the root cause of the deficiencies is individual processor timing delays. Re-education feedback was provided to involved staff during the course of the exam. ly, the Companies' Claim LPI Audit Team conducts ongoing monitoring of timely claim processing based on monthly data reports, root cause analysis of timing deficiency trends and focused panel review with involved staff and staff teams. The Companies were forwarding the cited claims to delegated vendors but m the case of claims for one vendor not accurately reflectifig the'forwarding action on EOBs/EOPs (instead, inaccurate reference to the claim being denied appeared on the EOBs/EOPs). As referenced in the Report the Companies completed their policy and procedure changes by June 2016 to ensure claim forwarding reference was accurate for all delegated vendors.

5 I iiiiliii'j S.iiiii' ;'r\ i.s of claims being denied rather than forwarded to the delegated vendor; the Companies assured that all future vendor claims were being forwarded. The Department is concerned that it took two years from the prior examination to complete corrective actions. CLAIMS - Concerns One (1) instance where a claim was derded in error and interest was not paid (CHLIC). One (1) instance where the Company was denying claims for Medicare COB coverage, when the member was not eligible for Medicare. The Department had the Company go back and reprocess the claims, and the Company processed 1,123 claims (CHLIC). procedures to ensure that complaints, grievances and appeals claims are all properly investigated and resolved pursuant to required claim handling requirements. As referenced in the Report the deficient claims were remediated to pay as required, with interest as applicable. The Companies' analysis of examined claims, and review of claim handling procedures determined that the root cause of the deficiencies is individual processor error. Re-education feedback was provided to involved staff during the course of the exam. ly, the Companies' Claim Quality Review Coaching Team conducts ongoing monitoring of timely claim processing based on monthly data reports, root cause analysis of timing deficiency trends and focused panel review with involved staff and staff teams. All Cigna products and services are provided exclusively by or through operating subsidiaries of Cigna Corporation, including Cigna Health and Life Insurance Company, Connecticut General Life Insurance Company, and HMO or service company subsidiaries of Cigna Health Corporation, including Cigna HealthCare of Connecticut, Inc. The Cigna name, logo, and other Cigna marks are owned by Cigna Intellectual Property, Inc.

6 CONNECTICUT INSURANCE DEPARTMENT MARKET CONDUCT EXAMINATION & REPORTS DOCKET MC SECTION II (3) Cigna Healthcare of Connecticut, Inc. ("CHC CT") SUMMARY OF ACTIONS TO COMPLY WITH MARKET CONDUCT REPORT RECOMMENDATIONS October 3, 2018 (.Ui'L,or\ PRODUCER LICENSING & APPOINTMENT Producers were not appointed by the respective Company within the timeframe required by statute CHC-CT producers Respective Company failed to notify the Department of an agent's termination for cause. 1 tioiaii's: S'.iicrii 'r\ \cii«-i It is recommended that each Company review its appointment system so that no new health business is accepted from, nor commissions paid to, individual acting as agents of the Company when they not appointed as required by statute. In Docket Numbers MC executed on August 8, 2006, and MC executed on November 27, 2013 CHC CT was cited for failure to ensure producers were not appointed within the timeframe required by statute. In addition it is recommended that the procedures to insure that all terminations for cause are properly reported to the Department. The Companies will take the following steps to fiirther J mitigate future appointment risk driven by inability to effectively operationalize "Just In Time" appointment processing: The Companies' Producer Compliance Team will work with our vendor, Vertafore, to modify our electronic on-boarding packets to proactively appoint, at time of contracting, all individuals and agencies with a Connecticut resident or non-resident license. Target Completion Date: December 31, ly, the Companies' Producer Compliance Team will implement a monthly process to identify and appoint any contracted individuals and agencies that newly obtain a resident or non-resident Connecticut license. Target Complete Date: December 31, Finally, the Companies' Producer Compliance Team has implemented a process for tracking appointment timing. The Companies will monitor appointment timing on a monthly basis for root cause analysis. Target Completion Date: Implemented in July Will continue to monitor.

7 I iliilll.l C'pinriK'iil Ri'iiiiiitiisciiil'ifin*! SuiiMiiiii'i ni' Vl'TIdi! In 2016, the Companies developed new policies, procedures and termination letter templates with regard to all terminations, including terminations for cause. Since that time, any true for cause terminations are reviewed and processed by the Companies' Producer Compliance Senior Specialist who ensures notifications are sent to both the producer and the state. To prevent errors in termination selection, the Companies have removed the option for someone to select for cause as a termination reason in Vertafore's Sircon Producer Database. The Producer Compliance Senior Specialist now places for cause appointment terminations directly through the National Insurance producer Registry CLAIMS CLAIMS- Concerns, Complaints and Appeals: Dental HMO EGBs/EOPs The examination found a combined twenty thousand eight hundred ninety (20,890) claims that were not paid within statutory timeframes for which required interest was paid. A combined one thousand four hundred two (1,402) claims were not paid within statutory timejframes where interest was owed (CHLIC, CMC CT, CGLIC). Several instances in the EGBs/EOPs that incorrectly noted the availability of external appeal through the Department. Standalone dental HMO plans are not eligible for the State of Connecticut external appeal program (CMC CT). Companies review their claim handling procedures to ensure that all claims are investigated and resolved pursuant to required claim settlement practices. The Department recommends that the Companies review policies and procedures regarding timely notification requirements, and sufficient information being contained in the appeals correspondences. As referenced in the Report the deficient claims were remediated to pay applicable interest. The Companies' analysis of examined claims, and review of claim handling procedures determined that the root cause of the deficiencies is individual processor timing delays. Re-education feedback was provided to involved staff during the course of the exam. ly, the Companies' Claim LPI Audit Team conducts ongoing monitoring of timely claim processing based on monthly data reports, root caus^'alhalysis of timing deficiency trends and focused panel review with involved staff and staff teams. The company has validated that all its dental HMG plans are standalone, and therefore not eligible for the State of Connecticut external appeal program. The Company on March 17 submitted to its intercompany IT department a request for EGB/EGP change implementation, testing, and timing. As of the date of this Summary, the IT department's validation of fmal production testing is pending.

8 r-jtf L<'i' C oiiwti'.11 > ' iipioikliiiinii iif The Company's State Compliance Team will provide the Department with a final production execution date once that execution is confirmed. All Cigna products and services are provided exclusively by or through operating subsidiaries of Cigna Corporation, including Cigna Health and Life Insurance Company, Connecticut General Life Insurance Company, and HMO or service company subsidiaries of Cigna Health Corporation, including Cigna HealthCare of Connecticut, Inc. The Cigna name, logo, and other Cigna marks are owned by Cigna Intellectual Property, Inc.

9 CONNECTICUT INSURANCE DEPARTMENT MARKET CONDUCT EXAMINATION & REPORTS DOCKET MC SECTION II (3) Connecticut General Life Insurance Company ("CGLIC") SUMMARY OF ACTIONS TO COMPLY WITH MARKET CONDUCT REPORT RECOMMENDATIONS October 3, 2018 ( au'ciii. 1- iiu'luu ( niiiinciu Ki'«'osiintoii(i ill loll (if \eiit>r. CLAIMS CLAIMS - Concerns: Delegated Vendor Claims The examination found a combined twenty thousand eight hundred ninety (20,890) claims that were not paid within statutory timeframes for which required interest was paid. A combined one thousand four hundred two (1,402) claims were not paid within statutory timeframes where interest was owed (CHLIC, CHC CT, CGLIC). Several instances where claims were denied rather than forwarded to delegated vendors. (CGLIC, CHLIC). Companies review their claim handling procedures to ensure that all claims are investigated and resolved pursuant to required claim settlement practices. procedures to ensure that claims are all properly invesitgated and resolved pursuant to required claim handling requirements. The Department, in prior examination reports, had concerns over the number of claims being denied rather than forwarded to the delegated vendor; the Companies assured that all future vendor claims were being forwarded. The Department is concerned that it As referenced in the Report the deficient claims were remediated to pay applicable interest. The Companies' analysis of examined claims, and review of claim handling procedures determined that the root cause of the deficiencies is individual processor timing delays. Re-education feedback was provided to involved staff during the course of the exam. ly, the Companies' Claim LPI Audit Team conducts ongoing monitoring of timely claim processing based on monthly data reports, root cause analysis of timing deficiency trends and focused panel review with involved staff and staff teams. The Companies were forwarding the cited claims to delegated vendors but in the case of claims for one vendor not accurately reflecting the forwarding action on EOBs/EOPs (instead, inaccurate reference to the claim being denied appeared on the EOBs/EOPs). As referenced in the Report the Companies completed their policy and procedme changes by-jiine 2016 to ensure claim forwarding reference was accurate for all delegated vendors.

10 lu'lji) 1 liidi!'.: CoiMiiii n: Si-ilM.:.' ^ (il took two years from the prior examination to complete corrective actions. In Docket Numbers MC 06-19, August 3, 2006, and , executed on December 20, 2013, CGLIC was cited for failure to establish proper policies and procedures to ensure that all claims were investigate properly and paid in a timely manner. CLAIMS- Concerns: Conversion Claims The examiners noted, one (1) instance where the Company incorrectly denied an ambulance claim. In addition, the policy is a Nationwide Conversion Trust Hospital and Surgical (Basic Indemnity) Plan and has not been refiled or updated with the Department since The Department is concerned that the Company is using policy forms not in compliance with Connecticut requirements. (CGLIC). As referenced in the Report the denied claim was re processed with applicable interest paid. The Company's State Compliance and State Filing teams will prepare a policy rider to add applicable Connecticut requirements to the Nationwide Conversion Trust Hospital and Surgical (Basic Indemnity) Plan, and submit the rider form to the Department's Life and Health division for approval no later than December 31, The Company notes that this Nationwide Conversion Trust Plan no longer covers any Connecticut insureds, and the Company's Connecticut large group market policies no longer contain conversion privileges. CLAIMS - Concerns Two (2) instances where the Company correctly denied the claims but used the incorrect remark code, for the denial language on the explanation of benefits (CGLIC). procedures to ensure that complaints, grievances and appeals claims are all properly investigated and resolved pursuant to required claim handling requirements. In Docket Number , executed on December 20, 2013, CGLIC was cited for failure to establish proper As referenced in the Report the deficient claims were remediated to pay as-retired, with interest as applicable. The Companies' analysis of examined claims, and review of claim handling procedures determined that the root cause of the deficiencies is individual processor error. Re-education feedback was provided to involved staff during the course of the exam. ly, the Companies' Claim Quality Review Coaching Team conducts ongoing monitoring of timely claim processing based on monthly data reports, root cause analysis of

11 roiiii'u'in ' Ki'CiiiiiiiiCJKl.iiioii policies and procedures to ensure that all claims were investigate properly and paid in a timely manner. timing deficiency trends and focused panel review with involved staff and staff teams. CLAIMS- Concerns, Complaints and Appeals: Out-of- Network Claim Appeals Fifty-five (55) appeals where a member went to an in-network provider who utilized an out-ofnetwork lab without notifying the member, and the Company processed the claim at the out-ofnetwork benefit level (CGLIC). The examiners are concerned that the Company failed to adopt reasonable standards for the prompt investigation of claims. It is recommended that-the procedures to ensure that complaints, grievances and appeals claims are all properly investigated and resolved pursuant to required claim handling requirements. As referenced in the Report the appeals were overturned and claims paid at the in-network level with applicable interest, where an in-network provider utilized an out-ofnetwork lab without notifying the member and the member initially was paid an out-of-network lab benefit. To review policies and procedures, the Companies analyzed claim data to determine availability of referring provider information, and identified the specific claim and appeal processing steps where carrier information and opportunity exist to intervene where an in-network provider utilizes an out-of-network lab without notifying the member. As referenced in the Company Response Addendum (June 12, 2018), in consultation with the examiners the Companies in January 2018 modified appeal policies and procedures to remedy claims where the in-network provider utilizes an out-of-network lab without notifying the member. A staff alert was issued,;to iughlight the policy and procedure change. Guidance provided to Appeal staff: NOTE: Out of Network Labs - CON Labs performed in the office or outpatient setting: ifan appeal is received from a member because they are being billed by the out-of-network lab due to the claim either being denied or processed out-ofnetwork, the NAG will follow the Appeal Process and overturn these types ofoutpatient lab scenarios, in cases where members are being held financially liable. ly the Companies issued in-network provider education letters via certified mail, highlighting the

12 ini.iiij ( oiniik'ii Ri loiiiiii*, 1 provider's obligation to refer members to participating labs and the potential grounds for contract termination for failure to meet that obligation; and analyzed claim data for further follow up with particular providers. CLAIMS - Concerns, Complaints and Appeals One (1) instance where the appeal determination was not sent within timefirames according to Connecticut requirements (CGLIC). One (1) instance where the appeal determination did not address the member's request for a network adequacy exception (CGLIC). One (1) instance where the Company did not follow their internal guidelines on acknowledgement of administrative appeals. In addition, the Company failed to disclose rights to contact the procedures to ensure that complaints, grievances and appeals claims are all properly investigated and resolved pursuant to required claim handling requirements. The Department recommends that the Companies review policies and procedures regarding timely notification requirements, and sufficient information being contained in the appeals correspondences. The Companies' analysis of examined appeals and review of policies and procedures determined that the root cause of the deficiencies is individual processor error. Re education feedback was provided to involved staff during the course of the exam. The Companies' National Appeals Organization Quality Department conducts a quality audit program, where feedback given to particular processors and to the quality coaching unit. ly, with respect to incomplete documentation the National Appeals Organizer transitioned its storage of appeal files including letters from team shared drive files to a commercial mainframe document storage system (HPE OneView). If '' Connecticut Insurance Department, and Office of Health Care Access (CGLIC). One (1) instance where the appeal was overturned with no new information to justify the decision (CGLIC). Three (3) instances, through a review of sample grievances and appeals that contained insufficient and incomplete

13 ! C IH»WtK'<li ' l-wsn Sii'sini.i" 'jf \ir ri, documentation for regulatory review (CGLIC). ; All Cigna products and services are provided exclusively by or through operating subsidiaries of Cigna Corporation, including Cigna Health and Life Insurance Company, Connecticut General Life Insurance Company, and HMO or service company subsidiaries of Cigna Health Corporation, including Cigna HealthCare of Connecticut, Inc. The Cigna name, logo, and other Cigna marks are owned by Cigna Intellectual Property, Inc.