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State fines MVP companies $200K for “improperly” denying health-insurance claims, charging for preventive services

The state has fined MVP Health Plan Inc. and MVP Health Insurance Company $200,000 for “incorrectly” applying cost-sharing to members’ claims and “improperly” denying some claims for preventive health-care services.

The companies agreed to pay the fine and to correct claims-processing procedures in a consent order reached with DFS, the New York State Department of Financial Services (DFS) said in a news release issued Tuesday.

Both MVP companies have agreed to make restitution, including interest, totaling about $9,000 to 356 of its members, DFS added.


MVP Health Plan is a nonprofit health-maintenance organization; MVP Health Insurance is a for-profit insurer that sells small-group policies and policies to individuals.

The two companies insure about 100,000 members in New York’s individual and small-group markets.

About the violations

The violations, which occurred between 2011 and 2013, were uncovered in a DFS examination of the insurers.

It found that some members’ claims were “improperly” denied by the insurers.

In other cases, members were “erroneously” charged cost-sharing expenses, such as improper co-payments or deductible charges.

The violations involved instances of “improperly” processing claims involving more than a dozen kinds of health-care screening or preventive services.

These included screening for breast, cervical and colorectal cancer, depression, hearing loss, and obesity in children and adults.

In addition to the restitution and the fine, the consent order directs the companies to update their claims-processing system; provide training for claims examiners; and explain to providers how to handle “certain mandated services” under the federal Affordable Care Act and New York law.

The DFS consent order requires the companies to provide DFS with documentation to verify that they have complied with the terms of the order.

“Health-insurance companies must provide necessary preventive services without co-pays and deductibles as the law requires,” Maria Vullo, financial-services superintendent, said in the release. “DFS will continue to hold companies accountable if they do not process all claims accurately, in a timely manner and to the letter of the law. DFS appreciates MVP’s cooperation in recognizing the importance of making sure its claims examiners and systems process claims correctly for all of its members.”

In reaction, Schenectady–based MVP issued the following statement.

“The DFS fine related to MVP inappropriately applying a cost share to certain preventive service claims during [the time period] 2011 [to] 2013. Although the cost share at issue totaled less than $10,000 and related to less than 1 percent of preventive-service claims, DFS imposed a $200,000 fine. We have addressed the operational issues that caused the error and all affected members were reimbursed for their co-pays, with interest,” said Ted Herman, VP, communications & public relations at MVP Health Care.

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