A class settlement requiring Cigna Health & Life Insurance Co. to broaden its coverage of specialized liposuction has been given final approval, marking a significant turning point in the treatment coverage for lipedema. However, in addition to approving the settlement, the court order noted how inflation is currently affecting the standards that govern class action settlements.
According to a detailed report by Bloomberg Law, Judge Jon S. Tigar issued an order on Tuesday in the US District Court for the Northern District of California approving the arrangement that will benefit approximately 239 patients.
The settlement resulted from a lawsuit brought forth by Banafsheh Akhlaghi under the Employee Retirement Income Security Act that led to Cigna altering its policy on liposuction coverage. The revised policy now deems liposuction as a medically necessary treatment for lipedema under certain criteria. This change, as per the settlement motion, is part of the settlement and won’t be altered unless there’s a relevant change in the medical consensus.
Judge Tigar also granted an inflation-adjusted incentive award of $6,752 to Akhlaghi for her role as the class representative, emphasizing that this amount has equivalent buying power to that of a $5,000 incentive award in 2012 – an amount seen as reasonable back then.
With the yearly inflation rate currently at 3.7%, Judge Tigar issued a general warning, stating that, “at some point, the common law will have to reckon with inflation.” He also suggested that the problem “will only become more pronounced.”
The lawsuit claimed that Cigna erroneously categorized liposuction surgery as an experimental or unproven treatment for lipedema, a chronic buildup of fat tissue that leads to pain, mobility problems, and joint disorders. The settlement now allows lipedema patients who previously had liposuction coverage requests denied to have Cigna reevaluate their requests under the new, more inclusive policy.
Despite this milestone, legal professionals, plaintiffs, and corporations alike should heed Judge Tigar’s caution about adjusting standards in accordance with inflation, an aspect not given much attention in class action settlements until now.