CCS Oncology claims in a new lawsuit that Independent Health drove patients away and prompted doctors to leave when it dropped the oncology practice from its insurance network.
The lawsuit filed in State Supreme Court accuses the Amherst-based insurer of causing irreparable economic harm. It is the latest escalation in the increasingly bitter dispute between CCS Oncology, the community-based oncology practice, and Independent Health, the region's second-largest insurance company.
In June, Independent Health notified 22 physicians at CCS Oncology, along with 600 of its members in active treatment at CCS, that it was dropping the practice from its network as of Dec. 31. The decision also affects about 1,400 inactive CCS patients.
Independent Health's actions, the lawsuit claims, "demonstrate an egregious disrespect towards the cancer-diagnosed public."
The insurance company counters it acted reasonably in declining to renew its contract with the physicians of CCS Oncology following 16 months of negotiation over a new reimbursement model for the practice.
"We firmly believe that there is neither legal nor factual support in the complaint that has been filed," Independent Health spokesman Frank Sava said in a statement.
The lawsuit, filed last week on behalf of the practice and 15 of its remaining physicians, outlines CCS Oncology's side of the story.
CCS Oncology complains that once talks broke down, Independent Health directly notified patients of the decision before its own doctors had a chance to talk to them, arguing this action drove patients away from CCS well before the Dec. 31 termination of the contract.
The suit also cites the "irreparable harm" caused by Independent Health's letter sent in June to other referring physicians in the insurer's network, because this caused those physicians to stop referring patients to CCS as many as six months before the termination date.
And CCS blames Independent Health's action for prompting oncologists to leave its practice. Five oncologists have left CCS since June, with several going to rival practices in the region, and 17 remain.
CCS Oncology wants Independent Health to reverse its decision and send letters to all of the patients, CCS doctors and network doctors notifying them that CCS will be included in Independent Health's network for 2017.
Dr. W. Sam Yi, CEO and executive medical director of CCS, said he knows the chances of the suit's success are uncertain. He wants a judge to issue an injunction that would require Independent Health to continue to cover the 2,000 patients while the suit proceeds. He said he and his colleagues filed this suit for their patients, not on their own behalf.
"Do not put cancer patients in the middle, Independent Health," Yi said. "Do not force cancer patients to choose between Independent Health and CCS Oncology."
The 15 physicians named in the suit seek an injunction forcing Independent Health to reverse its decision, as well as punitive damages.
The lawsuit alleges breach of contract, interference with the practice's relationship with its patients and violations of federal and state law that ensure access to health care.
It claims Independent Health violated a provision of federal law that prohibits discrimination in health care by insurers, violated a provision of the Affordable Care Act that prohibits excluding an individual from health insurance for a pre-existing condition and violated CCS' physicians' rights to advocate on behalf of their patients as guaranteed under New York Public Health Law.
The suit also accuses Independent Health of engaging in deceptive business practices by spreading "misinformation" to its patients, engaging in breach of contract, violating the good faith and fair dealing implicit in the agreements between the practice and the insurer, and acting "dishonestly, unfairly and improperly" by interfering in the relationship between CCS and its patients, among other claims.
Independent Health, for its part, said it provided more than the required amount of time for patients and physicians to prepare for the Dec. 31 end of the contract and it has worked extensively with patients to help them find another provider if they desire. The company said it believes it followed "all regulatory and contractual requirements" in deciding not to renew the agreement.
Independent Health noted in its statement that a panel of community physicians heard CCS' appeal of the non-renewal and ruled in Independent Health's favor.
"We do not believe that there are any new issues that could be subject in a lawsuit that have not already been decided in favor of Independent Health," Sava said in a statement.
Independent Health decided to drop CCS Oncology from its network after negotiations that began in spring 2015 failed to reach agreement on a new plan for how the insurer would reimburse the practice for the tests and treatments it provides its patients.
The Independent Health members who were CCS patients needed to either find a new cancer doctor, switch insurers if they could or stay with CCS but pay the higher out-of-network fees for their treatment.
Nationwide, Medicare and private insurers have shifted from a model that pays a fee for each service to a value-based model that reimburses based on patient outcomes.
Independent Health said it has had success in shifting to a value-based model with other oncology practices in the area, but CCS Oncology balked. The practice said the insurer sought to unilaterally impose its terms.
Independent Health also contends that CCS Oncology charged more for cancer treatments than other practices, although CCS Oncology objected to the insurer's methodology.