Cigna Sued by Drug Treatment Center for Alleged ‘Sham’ Audits

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Jacklyn Wille

Cigna Behavioral Health Inc. engaged in “sham” audits and other questionable cost-cutting tactics to reduce payments to medical providers, according to a new lawsuit by a drug and alcohol treatment facility ( Sunrise Detox III, LLC v. Cigna Behavioral Health, Inc. , S.D. Fla., No. 0:17-cv-60170-BB, complaint filed 1/23/17 ).

The lawsuit, filed Jan. 23 by two Sunrise Detox entities, alleges that Cigna launched an improper “cost-savings initiative” against substance abuse treatment centers. Under the initiative, Cigna ramped up unannounced inspections, audits and patient interviews—described in the complaint as “fishing expeditions devoid of due process”—with an eye toward recouping extra money and limiting patient access to medical treatment, the lawsuit claims.

The lawsuit cites both the nationwide opioid and heroin epidemic and the 2008 passage of federal mental health parity laws as drivers for Cigna’s alleged cost-cutting initiative. Cigna adopted these strategies to maintain its financial position in the face of “increased utilization” of substance abuse treatment services, according to the lawsuit.

In addition to conducting more frequent audits through its Special Investigations Unit, Cigna also systematically delayed reimbursement payments without explanation and subjected in-network medical facilities to audit procedures reserved for out-of-network providers, the lawsuit claims.

A spokesman for Cigna declined to comment on the allegations.

The lawsuit was filed in the U.S. District Court for the Southern District of Florida by Ver Ploeg & Lumpkin P.A. It raises eight state law claims, including breach of contract, professional negligence and fraudulent misrepresentation and concealment.

To contact the reporter on this story: Jacklyn Wille in Washington at

To contact the editor responsible for this story: Jo-el J. Meyer at

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