Kreutzmann v. Cigna Health and Life Insurance Company

Why This Matters:

Why This Matters:

An individual alleges that his health plan’s third-party administrator, Cigna, violated its fiduciary duties and engaged in a prohibited transaction under the Employee Retirement Income Security Act (ERISA). He, on behalf of a class of plan enrollees, alleges that Cigna uses a “shared savings” scheme that suppresses reimbursement for out-of-network ground ambulance services while incentivizing balance billing of patients. Cigna, he argues, profits from “cost containment fees” that are based on the difference between the original ambulance bill and the amount paid by the plan, while the remaining balance is passed on to the patient. This practice increases patient costs for ground ambulance services, which are often unavoidable.