UnitedHealth Group / Pacificare: alleged that 30% of the medical claims it reviewed were improperly denied ... 133,000 alleged violations ...

Health Plan Faces Fines of $1.33 Billion | By Lisa Girion | The Los Angeles Times | Tuesday 29 January 2008

California regulators are expected to announce today that they are seeking as much as $1.33 billion in penalties from Cypress-based PacifiCare as a result of widespread problems stemming from its takeover two years ago by healthcare giant UnitedHealth Group Inc.

In an investigation prompted by widespread complaints, the state Department of Insurance uncovered 133,000 alleged violations of state laws and regulations regarding payments for medical care. Each violation carries a maximum penalty of $10,000 for a possible total of $1.33 billion.

Separately, the state Department of Managed Health Care alleged that 30% of the medical claims it reviewed were improperly denied. That agency is seeking an additional $3.5 million in fines.

"These were very serious violations," said Cindy Ehnes, executive director of the Department of Managed Health Care. "The most fundamental promise of insurance is that they will pay when you are sick, and they will pay those physicians and hospitals in a fair manner." ...
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The potential fines are the latest black eye for UnitedHealth. Longtime Chief Executive William McGuire resigned in 2006. Last month, in the first settlement of its kind under post-Enron corporate reforms, he agreed to pay $468 million to avoid trial on charges that he secretly padded his paycheck by manipulating stock options. ...