A Colorado Court of Appeal has ruled that State Farm cannot exclusively use a computer database to determine reimbursement of medical bills. In the case, State Farm unilaterally reduced the medical bills because its database said the charges were higher than other orthopedists in the area, even though there were not any.
The court said it was “not persuaded by State Farm’s argument that Dr. Brucker’s bills were unreasonable as a matter of law because, according to the database, they exceeded 90 percent of charges for similar procedures in the same geographic area. A question of fact exists as to whether the database accurately assessed the reasonableness of the bills.”
This is an interesting case. Insurance companies routinely use databases to reduce the amount of medical bills. Now, at least in Colorado, this is going to be a problem for the insurance companies. They will have to take the doctor’s bill at face value in most cases.
How does this affect you? If you have a med pay claim, you need to make sure your treating doctor, including a chiropractor, is being paid in full. If he or she is not, see if the insurance company is using a database and ask them for a detailed reason as to why the doctor is not being paid in full.