Aetna said Tuesday it will take an after-tax $47 million hit to second-quarter earnings because other companies it expected to help pay for its class-action settlement with physicians have refused to do so.

Aetna, which had expected to collect $72 million from litigation insurance, said a Pennsylvania trial court on Monday dismissed the company's claims against its insurers.

Aetna had bought policies to cover litigation contesting its business operations.

Aetna said it will appeal the ruling "and continue to vigorously pursue recovery from its third-party insurers."

The Hartford-based health insurer settled class-action litigation with state medical societies in 2003 for $170 million, including $100 million to a physicians' fund, $20 million to seed a new health care foundation, and $50 million in plaintiffs' legal fees.

Aetna spent $25 million to defend itself in the case and believes its insurers should cover that, in addition to the $100 million and $20 million amounts.

The lawsuits accused Aetna of improperly reducing claim amounts that doctors billed and using coercive economic power to force physicians into unfavorable contracts.

During the second quarter of 2003, Aetna recorded an after-tax charge of $75 million ($115 million pretax) to reflect the settlement with physicians.

The new $47 million after-tax charge announced Tuesday reflects the $72 million the company had expected insurers to pay and recorded in financial statements as a receivable.

The insurers Aetna has been battling with include Lexington Insurance Co. and National Union Fire Insurance Co. of Pittsburgh, which are part of American International Group; Fireman's Fund Insurance Co. of Ohio; Executive Risk Specialty Insurance Co.; Liberty Mutual Insurance Co.; and certain Lloyd's of London underwriters.

The companies cited exclusions in their insurance contracts, and Lloyd's said Aetna couldn't prove its settlement was reasonable, according to a brief Aetna submitted in the case.

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Copyright 2006, Hartford Courant