A federal judge in Connecticut has dismissed a class-action lawsuit accusing Cigna of overcharging for medical equipment. Given that each affected health plan and the TPA contract with Cigna needed an individual analysis, the plaintiffs were unable to show commonality. In 2017, a lawsuit was brought against Cigna, alleging price gouging and member overpayments being kept for themselves. Claims of overcharging for home medical equipment and services obtained through CareCentrix were the focus of the class certification, which centered on Cigna’s previous arrangement with that company.
A federal judge in Connecticut has rejected a class-action lawsuit brought against Cigna, which accused the company of overcharging its members for medical equipment and breaching its fiduciary obligations under the Employee Retirement Income Security Act.
Cigna maintained that the plaintiff’s claims could not be adequately investigated without conducting an “individualized assessment” of each affected health plan and evaluating the terms of their third-party administrator (TPA) contract with Cigna. The judge agreed with this argument, ruling that the plaintiffs failed to establish commonality.
In the judge’s written decision, it was stated, “Due to the range of potential outcomes across the class and the possibility that Cigna’s actions may be permissible in certain instances while impermissible in others, it is not feasible to impose a single injunctive relief for the entire class.”
The lawsuit was initiated in 2017 and alleged that Cigna had artificially inflated prices for medical devices and services, thereby profiting from the excessive payments made by its members. In 2022, individuals who were Cigna members or had utilized Cigna as a third-party benefits administrator sought class certification for the case, citing the involvement of thousands of potential plaintiffs and plans.
Although the original complaint included various allegations of ERISA violations and service overcharges, the focus of the class certification request centered on Cigna’s previous contract with CareCentrix, which was in effect from 2003 to 2021.
The plaintiffs claimed that CareCentrix, a manager of home health benefits, paid lower prices to other providers for the same services compared to what Cigna paid CareCentrix. They further alleged that Cigna overcharged for home medical equipment such as canes and CPAP machines, as well as for other services arranged through CareCentrix.
