Gov. levies second fine on Aetna for insurance law violations

Gov. Jay Nixon was in Springfield yesterday to announce a $4.5 million state settlement for insurance law violations by two divisions of insurance provider Aetna (NYSE: AET).

At the Burrell Autism Center, Nixon said Aetna Life Insurance Co. and Aetna Health Insurance Co. failed to extend coverage for the diagnosis and treatment of autism spectrum disorders – a violation of state law passed in 2010. The settlement amount represents Missouri’s largest fine against an insurance company, according to a news release, and it’s the second offense by Aetna.

“The landmark law requiring insurance companies to cover autism spectrum disorders was a great victory for many thousands of Missouri kids and their families,” Nixon said yesterday. “This agreement demonstrates that we will hold Aetna or any other insurance company responsible to the people of this state – particularly children with autism disorders – to provide the coverage the law requires.”

Under the settlement terms, Aetna will be monitored for three years and violations would allow the Missouri Department of Insurance to suspend the companies from doing business in the state for up to one year, according to the release. Aetna agreed to file a corrective action plan to provide the autism coverage in Missouri. A portion of the fine, $1.5 million, would be suspended if Aetna meets those terms, the release said.

A key part of the 2010 law is requiring coverage for applied behavioral analysis, a reportedly effective but costly autism therapy. According to the release, ABA treatment can exceed tens of thousands of dollars for families of children receiving the therapy.

Aetna also was reprimanded in 2012 for violating Missouri’s autism mandate and paid a $1.5 million fine under a settlement agreement with the Department of Insurance. Though Aetna agreed to complete an audit to ensure compliance with state insurance laws, the release said the publicly traded company admitted it did not perform a full compliance audit.

Aetna’s fines will go into the state public school fund, as do all civil fines, according to the Missouri Constitution.

Hartford, Conn.-based Aetna recorded $15 billion in first-quarter revenue this year and quarterly net income of $777 million, according to its earnings report.