SAN DIEGO (December 10, 2004) — On Monday, December 6, 2004, the San Diego Superior Court granted American Specialty Health Plans of California, Inc. (ASH Plans) and American Specialty Health Networks, Inc. (ASH Networks) summary judgment on key claims filed by the California Chiropractic Association (CCA) in 2001. With this ruling, and others previously issued, the Court has now granted summary judgment to ASH Plans and ASH Networks on 15 of 18 claims asserted by CCA against each of these companies. CCA's complaint originally challenged essentially every feature of ASH Plans' and ASH Networks' managed care practices, contending that such activities were unfair, unlawful, and fraudulent. McDermott Will & Emery served as counsel for ASH Plans and ASH Networks.
In 2001, the CCA filed suit against ASH Plans and ASH Networks, two managed care companies, seeking injunctive relief on each of the 18 claims and millions of dollars of restitution. The Court will soon hold a short trial on CCA's remaining claim where CCA argues that ASH Plans and ASH Networks failed to pay a small group of claims that the companies believe were untimely submitted. ASH Plans and ASH Networks expect that matter to be resolved expeditiously.
The Court's decision noted that CCA failed to produce any evidence that the utilization management practices were "contrary to generally accepted professional/medical standards" or "arbitrary." With respect to chiropractor reimbursement, when presented with evidence that included the Department of Managed Health Care's finding that ASH Plans' chiropractor reimbursement rates were "reasonable in relation to industry practices," the Court determined that there was no reason that it should interfere with ASH Plans' or ASH Networks' provider reimbursement schedules, denying both injunctive and monetary relief on these claims. The Court made a similar ruling on CCA's claim that ASH Plans had improperly administered a now-discontinued contractual withhold. The Court also held that CCA failed to present any evidence that ASH Plans or ASH Networks had terminated any chiropractors without cause in the past seven years and thus that there was no basis for CCA to prevail on its claim that defendants' chiropractor termination practices were unfair, unlawful or fraudulent. Finally, the Court found that CCA's claim challenging ASH Plans' and ASH Networks' prior decision to limit acceptance in the network to a specified number of chiropractors within a particular area could not be sustained on any grounds.
American Specialty Health (ASH), based in San Diego, and its affiliates are the nation's largest organization for complementary health care benefit programs, health education programs, and health-related products measured in terms of annual revenues, members/insured, employees, contracted providers and contracted health plans. Its affiliate, ASH Plans, is California's first and largest specialized health plan for chiropractic and acupuncture benefit programs. ASH Plans provides chiropractic and acupuncture benefit programs to full-service health plans and employer groups. ASH Plans covers over four million members/insureds, and is California's third-largest specialty health plan. ASH administers benefit programs for 11.5 million members and discount programs for over 75 million members.
The McDermott legal team advising ASH Plans and ASH Networks included Michael O'Neill of the Firm's Orange County office.