Denied Disability Insurance Lawsuit Filed in Los Angeles

Los Angeles, CAAn insurance lawsuit has been filed by the spouses of dockworkers at the Los Angeles Port, alleging the port’s health care plan is subject to unacceptable backlogs and health care insurance denials.

According to the Los Angeles Times (3/5/15), the lawsuit was filed by two women whose husbands are longshoremen, and one doctor who has not been paid for his services. Kristen Andrich, one of the plaintiffs, alleges she received treatment for diabetes and a spinal injury, and was given approval to have the medical care covered. After racking up $380,000 in medical claims, Andrich’s medical treatment was reportedly denied or went unpaid.

Court documents note that issues with the insurance program began in 2013, after Zenith American Solutions became the third-party administrator for the health care plan. According to the lawsuit, Cigna stopped processing claims a month before it was supposed to, resulting in 89,000 unprocessed claims at the start of 2013. By the summer of 2013, there were allegedly 286,000 unprocessed claims, because “Zenith lacked adequate, trained personnel to administer the Plan,” the lawsuit claims. This, along with the use of a “prepayment fraud review system,” resulted in the backlog growing worse, with around 90,000 new claims per month by the end of 2013.

Along with Andrich, Lorena Armijo and Dr. Ralph Mayer are named plaintiffs in the lawsuit. The plaintiffs allege thousands of policyholders and dependents have not had their claims repaid, despite the treatment being deemed necessary and despite it being covered by the health care plan. This has allegedly led to doctors and hospitals not being paid, medical providers seeking payment from plan participants, policyholders not receiving reimbursement for their payments, and some patients not seeking necessary medical care, causing extreme hardship.

“When a claim is denied and a request to review the denial is timely submitted, Zenith either summarily denies the appeal, or simply refuses to act on the appeal, in which event it is deemed denied with the passage of time,” the lawsuit alleges.

Tens of millions of dollars in unreimbursed health care claims are at issue in the lawsuit, which names Zenith American Solutions, the Pacific Maritime Association and Cigna Inc, as defendants. Plaintiffs in the lawsuit seek class-action status.

The lawsuit is Armijo et al v. ILWU-PMA Coastwise Indemnity Plan et al, case number 2:15-cv-01403, in the US District Court, Central District of California - Western Division.