Rising hostility brings suits against HMOs
Rising hostility brings suits against HMOs
Almost every day, there’s a news story about someone suing a managed care organization. "There has been an outpouring of lawsuits, ranging from some very large, sweeping lawsuits that have gotten national publicity to a rash of smaller cases of a more traditional nature that don’t get too much press," says Arthur Lerner, an attorney with Michaels & Bonner, PC, a Washington, DC, law firm.
The firm’s Web site (http://www.michaels bonner.com) includes an HMO Lawsuit Watch which lists and tracks major lawsuits against managed care organizations (MCOs). However, he adds, so many suits are being file that it’s difficult to keep the Web site updates current.
"It used to be that the bulk of the health care coverage business was in more traditional indemnity type of programs, and now it’s managed care. Bigger business gets a lot more attention, and my sense is that the hostility level [against managed care] is higher," Lerner says.
In addition, he adds, the media has picked up on the issue of managed care and the practices of MCOs. "In this current legal environment, health plan think it’s time for shooting practice and they are the target," he says.
A sampling of recent suits and other legal actions include:
- Payton v. Aetna U.S. Healthcare, Inc.. The New York County Supreme Court has allowed a negligence claim to proceed against the HMO for unwarranted delays in failing to issue a determination of medical necessity for inpatient substance abuse treatment despite repeated attempts by the enrollee to obtain a decision before he died from an accidental drug overdose.
- The American Medical Association and Medical Society for the State of New York v. Metropolitan Life Insurance Co. and United HealthCare Corp. This class action suit claims that patients, who paid higher premiums for out-of-plan physicians, had to pay more than they should have for treatment. The suit charges that the health plans agreed to pay 80% of usual, customary, and reasonable charges for out-of-plan physicians but used "inappropriate data" to understand the usual, customary, and reasonable charges, resulting in lower payments to providers.
- Green v. Aetna U.S. Healthcare, Inc. This class action suit against a group of California HMOs claims that coverage was wrongfully terminated for an estimated 40,000 Medicare HMO enrollees and that the defendants induced the enrollees to leave their former health care programs even though the companies knew they might leave the HMO market.
- Landa v. Humana Medical Plan Inc. and Cutler v. Humana Medical Plan Inc. These lawsuits filed by Florida physicians allege that Human routinely "downcoded" physician bills. Since the lawsuit, the physicians and Humana have reached an agreement that seeks "to ensure that physicians know how to correctly submit claims and are being reimbursed in a fair and timely manner."
- Harrison v. Aetna U.S. Healthcare, Inc. The American Medical Association and the Medical Association of Georgia joined in this class action lawsuit charging that providers are not paid in accordance with the state’s "prompt pay" statutes.
"It’s hard to know how much these lawsuits and the publicity they generate will affect the health care system and whether it will be all good, all bad, or a combination," Lerner says. "Congress and many state legislatures are considering different types of managed care reform."
He points out that many health plans are looking at different ways of doing things without waiting for the lawsuits to be settled. He cited United HealthCare’s decision last November to allow doctors, not health plan administrators, to have the final say on medical necessity. "Nothing is going to turn back the clock, but there is a pendulum and it does swing."
Physicians have the opportunity to effect changes in managed care practices by joining together to fight the things they feel are unfair, Lerner says. "One of the great things about our country is that people can join together in class action lawsuits, and they can lobby their state legislatures and Congress. It’s part of the way things change in our country."
He recommends developing strategic plans that will allow your practice to prosper in a managed care environment.
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