Two states are scrutinizing Aetna's processes for approving or denying payment for medical care after a former Aetna medical director admitted he never reviewed patient medical records when deciding whether to authorize treatment.

The states' inquiries and the medical director's admission, which drew scorn from the medical community, are a public relations nightmare for Hartford, Conn.-based Aetna, and puts a microscope on the insurance industry's pre-authorization and appeals processes. It could also hamper the national insurer's ability to merge with pharmacy giant CVS Health.

California Insurance Commissioner Dave Jones on Monday confirmed he is launching an investigation into Aetna's processes in denying claims and requests for prior authorization for care, as well as its utilization review process. Later that day, Colorado's insurance department said it would be asking questions about Aetna's compliance with state law regarding consumers' rights to appeal a coverage decision.

The two insurance departments were reacting to an October 2016 deposition of Dr. Jay Iinuma, who worked as Aetna's medical director for Southern California from 2012 to 2015, in a lawsuit concerning Aetna's denial of coverage for treatment of a patient's autoimmune disease in 2014.