Dockworkers’ insurance firm is sued over claims

Longshoremen’s health plan owes millions in doctor payments, suit says.

The spouses of two West Coast dockworkers and a doctor have sued a longshoremen’s union health insurance plan, alleging millions of dollars in unpaid legitimate claims in the last two years.

The suit, which seeks class-action status, comes just after shipping companies and dockworkers with the International Longshore and Warehouse Union resolved a long-standing labor dispute that caused severe congestion at West Coast ports.

The lawsuit alleges that the healthcare plan is riddled with backlogs of hundreds of thousands of unprocessed claims that have left doctors, union members and their families on the hook.

Most of the problems stem from claims that are outside the plan’s medical network, yet were pre-approved by administrators, according to the lawsuit.

Kristen Andrich, a plaintiff in the suit who is married to a longshoreman, said she has more than $380,000 in outstanding medical claims for diabetes treatment and injections to reduce neck pain from a spinal injury. Andrich, who lives in San Pedro, said she and her doctors sent in documentation before each procedure to ensure they would be reimbursed by the plan.

Administrators gave them the go-ahead, she said, but then months later either denied the claims or failed to pay them.

“How can a claim on one hand be approved and then on another be denied — with the same information?” she asked.

The healthcare plan is administered by the union and the Pacific Maritime Assn., which represents the shipping companies. Both groups declined to comment on the lawsuit, which was filed last week in Los Angeles.

The lawsuit alleges that problems started in 2013, when Zenith American Solutions took over from Cigna as the third-party administrator overseeing claims for the union’s healthcare plan. The transition led to an enormous backlog of claims that has continued over the last two years, according to the suit.

Part of the delay stems from concerns about fraudulent medical claims. According to the suit, Zenith hired a separate firm to initiate a “prepayment fraud review” system intended to ferret out bogus claims that shouldn’t be paid by the union’s healthcare plan.

A Zenith representative declined to comment on the suit.

Complaints about the delays date to summer 2013, when union members and retirees at several West Coast ports protested Zenith’s handling of medical claims. At the time, the shipping industry issued a news release saying Zenith and a fraud administrator had identified “tens of millions of dollars in potential abuses by doctors and other providers.”

The release cited billing of cosmetic surgery (not covered by the plan) and billing for services that were never provided.

Michael McClelland, one of the attorneys who filed the recent lawsuit, said concerns about fraud do not justify delaying payments to doctors who were pre-approved to provide services under the plan.

“They’re balancing their books on the backs of innocent doctors and hospitals who did everything they could to make sure they played by the rules,” McClelland said.

The federal lawsuit is the latest in a string of suits filed in the last year alleging payment delays by the union’s health plan.

The suit seeks monetary relief for those affected by the delays, along with the removal of Zenith as the claims administrator. The suit also seeks to remove the three shipping industry representatives who are trustees of the health insurance plan.