Farmers Insurance announced last month that it had settled a nationwide class action lawsuit relating to the medical bills of persons involved in car accidents. The settlement may affect Farmers policyholders, or those who were being paid for by a Farmers policy, who filed claims for medical coverage. The case was filed in the District Court of Canadian County, Okla., in 2004.
The Plaintiffs alleged that Farmers’ process of reviewing the amount that was billed for medical care, and then reducing or denying payment if the amount exceeded the 80th percentile of charges for that service, was wrongful and a breach of contract. Farmers took the position that this practice resulted in a benefit to the policyholders because the reduced payment was usually accepted by the medical provider. It claimed that it left the policyholder with more room before they ran up against the limit of coverage.
The settlement class is all persons who submitted a claim for medical bills related to a car accident under Medical Payments (Med-Pay) coverage or Personal Injury Protection (PIP) coverage and had their claim reduced by Zurich Services Corp. between January 2001 and early February 2009. Settlement claims will pay 60% of the difference between the amount of the bill submitted to Farmers for payment and the reduced amount actually paid. Individuals who believe they may be part of the group can go to www.MedpayClaimsAdministration.com or call 1-877-846-0588. Rick Bisher, a lawyer from Oklahoma City, was the lead lawyer for the Plaintiff group. The announcement that Farmers made relating to the settlement was required by the settlement agreement.
