Hearing set March 24 in '05 Cincinnati Insurance PPO settlement dispute

Amelia Flood Mar. 15, 2011, 2:27am


A dispute involving the settlement of a 2005 Madison County class action against Cincinnati Insurance Company over Preferred Provider Organization (PPO) discounts will be heard March 24.

Circuit Judge William Mudge has been considering whether to order payment to class member Illinois Bone and Joint Institute (IBJI) of more than $500,000.

Cincinnati argues that the institute, one of a class of 32,000 health care providers led by chiropractor Frank Bemis that settled with the insurer for $3.5 million, did not follow the proper claim procedure.

Bemis led the class against Cincinnati alleging the insurance company took PPO discounts on workers' compensation claims that it was not entitled to.

The suit was one of a number of PPO class actions filed against various insurance companies in the middle of last decade before the Class Action Fairness Act went into effect.

Cincinnati and the Bemis class settled last year.

Bemis, as lead plaintiff, was awarded $5,000.

Attorney Robert Schmieder II and the rest of the plaintiff's team were to receive more than $700,000 in fees.

The insurance company has paid out $57,000 of more than $485,000 that IBJI submitted in claims.

The company denied the rest alleging the institute did not submit the supporting documents needed to pay the claims.

Mudge heard arguments presented by Schmieder II and Cincinnati counsel Omar Odland in December 2010 for and against paying the claims.

Mudge took the matter under advisement.

The parties also submitted additional briefings and documents for Mudge's review.

The notice of the March 24 hearing was filed March 11.

The case is Madison case number 05-L-178.

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