Mid-Century/Farmers Insurance PPO - Class Certified

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An Illinois circuit court has certified a class action case against Mid-Century Insurance Company, Farmers Insurance Exchange, and Farmers Group, Incorporated by Illinois medical providers who accuse the company of questionable practices to reduce medical bills from 2001 into 2004.

An Illinois circuit court has certified a class action case against Mid-Century Insurance Company, Farmers Insurance Exchange, and Farmers Group, Incorporated by Illinois medical providers who accuse the company of questionable practices to reduce medical bills from 2001 into 2004.

The case is pending in the Twentieth Judicial Circuit, St. Clair County, Illinois. Lebanon Chiropractic P.C. v. Mid-Century Insurance Company, et al., Cause No. 06-L-8. According to the lawsuit filed on behalf of medical providers, Mid-Century has engaged in a silent Preferred Provider Organization scheme. In a PPO, insurance companies provide financial incentives to encourage patients to seek treatment from the preferred or in-network providers. A "silent PPO" occurs when an insurance company breaches its obligation to refer patients, through the use of financial incentives, to medical providers but still takes the discounts on the medical providers' bills. As a result, the medical provider loses revenue without gaining patients, receiving nothing in exchange for the reduced bills.

Jon Piper of LakinChapman said, "For many years Farmers took improper discounts from Illinois medical providers under its auto policies. These are the kinds of practices that led Farmers to be ranked one of the ten worst insurance companies in America in a recent study. We are now one step closer to making Farmers pay for its abuse of customers and doctors."

The trial court certified the following class: "All licensed healthcare providers in the State of Illinois who in the period 2001 through March 1, 2004: (a) submitted first-party claims to Farmers[/Mid-Century] pursuant to an automobile policy's medical payments/expenses ("Medpay") provision that did not contain a PPO option; (b) received or were tendered partial payment but in an amount less than the submitted medical expenses, based on a CCN preferred provider discount, and (c) received or were tendered and amount less then the stated policy limits." The Court appointed Lebanon Chiropractic Clinic, P.C. as class representative and LakinChapman, LLC as lead class counsel. The certification of a class is an important step in moving a class action case forward.

Brad Lakin, Managing Partner of LakinChapman, LLC said his firm is pursuing several other class actions cases against insurance companies on behalf of medical providers.

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