Fraudulent Reimbursement By Insurance Companies

Fee Schedule & Billing Information




I. Out-of-Network Underpayment.

II. The 3-day ketamine treatment is reimbursed by insurance companies and government agencies.

III. Sample letter from physician to insurance company.


I. Out-of-Network Underpayment

On January 13, 2009, the New York State Attorney General Office published a 24- page  report concluding:

“The current industry model for reimbursing out-of-network care is fraudulent. The industry uses a conflict-laden database riddled with errors at the expense of the consumer.

The database is neither independent nor fair. This leads to chronically flawed decisions. Given the heavy burden of health care costs that working families must bear when insurers fail to pay what they owe, the out-of-network system must be fixed”.

Click here for the Attorney General's HEALTH CARE REPORT

On July 24, 2008, Health Net Inc. was ordered to pay $255 million to settle out-of-network underpayment allegations. Health Net insures 3.9 milliom members in New Jersey, New York, Connecticut, and on the West Coast, through several health insurance subsidiaries. The investigation found that some insurance companies "dramatically" under-reimbursed their members for out-of-network medical expenses. As a result, New York state Attorney General Andrew M. Cuomo issued 16 subpoenas to the largest insurers in the country, including Aetna, Cigna, and Empire BlueCross BlueShield.

On January 15, 2009, UnitedHealth, one of the largest health insurance companies in the United States, agreed to shell out $350 million to settle lawsuits that claimed the company shortchanged consumers and physicians when paying for medical services outside its preferred network.

The settlement would provide for payments to doctors who claimed they were underpaid and patients who said their plan didn’t cover enough of their out-of-network care. An independent third party will figure out who gets what.

 Aetna announced its own deal with the New York State Attorney General Office. The company will stop using a database developed by Ingenix Inc. (a company controlled by United health) to determine out-of-network pay and will kick in $20 million to help fund the independent third party.



1. You have the right to appeal. Read your insurance materials and the notice from your insurer, called an explanation of benefits. It will explain how to appeal.

2. If you live or work in New York, the Attorney General’s Office may be able to assist you by advocating for you with your insurer. Click here to file a complaint

3. If you do not live or work in New York, contact your local Attorney General’s Office for assistance.

Click here for the contact information for the State Attorney General for your state. You want to speak to a lawyer in the Consumer Fraud Division.



The best advice is to get an attorney who practices health insurance law. Your physician can not act as your attorney.  

Physicians do not have the time to read your PPO contract which is the basis for your complaint against the insurance company in your case.

If you don’t get an attorney, you must act as your own attorney.

It’s not “rocket science”:

Step 1: Make sure you appeal a denial of benefits in the exact manner required by your policy.  Usually this is summarized in the Explanation of Benefits form denying your claim.  There is a time limit, there is specific information that must be furnished, and it must be sent to a specific address.  If the Explanation of Benefits form does not give details of the basis for denying your claim, get the specific allegations against you for denying usual and customary reimbursement according to your insurance contract. Then you can launch a specific fact-based reply to those allegations.  You can use the information provided on this web page for your specific fact-based reply to the allegations.

Step 2: Create a paper trail that will form a legal foundation for a complaint to the Attorney General’s Office for your state.  Save copies of everything you send to the insurance company, and everything you receive from them.  Take notes of every phone conversation with anyone from the insurance company, and note the date, time, name of the person you spoke to, what the person said, and what you said.  Ask permission to record the conversation.  Send a confirming letter if you are told something significant, such as the treatment should be covered or the bill will be paid.

List of Attorney General’s Offices in the USA    


REMEMBER: You have more clout (i.e. the power to direct) than your physician in this matter because only you have a contract with your insurance company.




II. The 3-day ketamine treatment is reimbursed by insurance companies and government agencies.

Here are some suggestions / talking points regarding reimbursement from insurance carriers for treatment with intravenous (IV) ketamine.

Treatment of breakthrough pain due to RSD / CRPS is an accepted treatment by all insurance companies.

For over 30 years, treatment of breakthrough pain with IV ketamine at doses up to and including those doses required for general anesthesia has been approved by the Food & Drug Administration (FDA).

Ketamine is approved as a “general anesthetic". Anesthesiologists, therefore, are most qualified to use the drug. For more than three decades, anesthesiologists have used ketamine to treat breakthrough pain in numerous clinical situations because of its unique properties.

For example:

¶ Breakthrough pain during dressing changes in burn victims (where intubation is not required because ketamine is a mild respiratory stimulant)

¶ Breakthrough pain during procedures in children (where no IV required because ketamine can be given IM)

¶ Breakthrough pain in asthmatics (where ketamine is a bronchodilator)

¶ Breakthrough pain in wounded soldiers (where ketamine supports blood pressure)

¶ Breakthrough pain in patients with RSD / CRPS (where ketamine uniquely inhibits the excitatory neuropeptide responsible neuropathic pain called glutamate and avoids the serious complications associated with the use of opioids - narcotics - to treat breakthrough pain).

  Two well-controlled studies demonstrate the long-tem benefits of outpatient ketamine infusions

Therefore, insurance companies are obligated to reimburse patients for customary and usual cost for the treatment of breakthrough pain with IV ketamine without further delay pursuant to PPO contracts.

Click here for supporting documentation by experts in the field stating that IV ketamine is the ideal medication for breakthrough pain in patients with RSD / CRPS

Ketamine is being used at the dose and route of administration as approved by the FDA to treat and control pain due to RSD / CRPS. Some insurance companies might try to argue that the FDA did NOT approve ketamine to treat RSD / CRPS. However, the FDA gave no specific medical condition / disease state as an indication for the drug. No medication has ever been approved by the FDA specifically to treat RSD / CRPS. Yet insurance companies routinely cover most medications to treat this neurological disorder.“Off-label” use of drugs is common in the USA and Canada.

In January 2009, the Canadian Government recognized escalating doses of IV ketamine on an outpatient basis as a treatment for RSD / CRPS.

Click here for guidelines for the reimbursement by the Canadian Government.  



The safety and efficacy of ketamine at high (coma) doses for several days in the ICU has been reported in peer-reviewed journals as follows:

Brain-Injured Patients

RSD / CRPS Patients With Intractable Pain


Life-threatening complications are possible with alternative pain medicines often used to treat RSD / CRPS. These medications include narcotics such as morphine and methadone (which are routinely reimbursed by health insurance). Ketamine, in contrast to narcotics, provides durability for relief of pain without potential life-threatening complications such as respiratory depression. In addition, unlike narcotics, ketamine is unlikely to require expensive hospital admissions due to respiratory depression.

Click here for CPT Codes used in the USA by health insurance companies to reimburse for treatment with ketamine


 III. Sample Physician Letter For Insurance Company

Draft of letter available


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