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Travelers units sued over discounting workers comp medical fees


PORTLAND, Ore.—Travelers Casualty & Surety Co. and several other units of Travelers Cos. Inc. are accused of illegally discounting workers compensation medical fees in a class action lawsuit filed late last week.

Lincoln City Physical Therapy L.L.C. says Hartford, Conn.-based Travelers improperly applied discounts for workers comp services offered through various preferred provider organizations. The provider contends that such discounts are not allowed under Oregon's workers comp law, and says that “hundreds of medical providers” in Oregon were underpaid by Travelers.

The case, Lincoln City Physical Therapy L.L.C. vs. Travelers Casualty & Surety Co. et al., was filed Friday in U.S. District Court in Portland, Ore. The plaintiff seeks an unknown amount of damages, as well as to recover PPO discounts that reportedly were applied by Travelers.

Oregon has three methods for determining workers comp care fees, according to the lawsuit. They include a fee schedule from the Oregon Workers’ Compensation Division, and rates set by managed care organization contracts. A third method includes payments for provider billings that cost less than the Oregon fee schedule rate.

By paying discounted rates through private PPO agreements, the lawsuit said Travelers failed to issue payments that were “required by applicable Oregon rules and statutes.”

"Plaintiff and members of the class would have expected remuneration from (Travelers) in the amount allowed under applicable workers' compensation statutes and rules had they known that PPO discounting was illegal," the lawsuit reads.