Report: California Seeks $9.9 Billion in Fines Against Insurer

The Los Angeles Times reports state regulators are seeking fines of up to $9.9 billion from Cypress-based PacifiCare, however the fine, if there is one, is likely to be much less than the maximum allowed.

Citing court filings and other documents, the Times reported on its Web site that the California Department of Insurance alleges PacifiCare violated state law nearly 1 million times from 2006 to 2008 after it was purchased by UnitedHealth Group Inc. The allegations include the mishandling of claims and loss of patient documents.

The state’s accusations are included in documents filed with a state administrative law judge who has been hearing testimony intermittently since last December in Oakland. The judge will decide whether to recommend penalties at the conclusion of the hearing.

PacifiCare and UnitedHealth Group have denied the state’s allegations.