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Miami Judge Approves HMO Settlements

Oct. 3, 2005

U.S. District Court Judge Federico Moreno recently signed off on two settlements reached by Health Net and Prudential Financial Services, two of the managed care companies involved in the massive class-action lawsuit by thousands of physicians. This brings the number of settlements approved by Moreno to four in the class-action lawsuit against 10 of the nation's largest HMOs. This settlement provides that Health Net will pay $40 million to active and retired doctors, and will spend an estimated $80 million to improve the process of dealing with doctors' claims submissions. Prudential will pay $22.2 million for managed care improvements. Health Net will pay $20 million in doctors' attorney fees, and Prudential will pay $5 million. WellPoint Health Networks and Anthem also have reached tentative settlements. The trial is scheduled in January 2006 for the four remaining managed care companies -- Coventry, United Healthcare, Humana and PacifiCare -- but negotiations to reach settlements are ongoing, and more settlements are expected before the trial date.