Mixed decision for managed care industry - News at Deadline - Brief Article

Physician Executive, Nov-Dec, 2002 by James A. Hawkins

A federal judge in Miami gave the go-ahead for a half dozen class-action suits on behalf o the nation's physicians against the managed care industry In a related move, U.S. District Judge Federic A. Moreno, denied class-action status to several suits being brought on behalf of patients.

The plaintiffs in these cases accused the defendants--including Aetna, Cigna, Humana, Health Net, and United Health Group--of violating the federal Racketeer Influenced and Corrupt Organizations Act, better know as RICO, along with ERISA and a variety of state laws.

In turning down the request for class certification for members of health plans, the judge ruled that the plaintiffs failed to prove that they were a uniform class that had been abused by the deceptive marketing of the various health insurers. The judge noted health plans are negotiated around the country and often vary from one contract to the next, so the plaintiffs were not similar enough to be lumped together into a single group.

Lawyers for the health plan members contended that there was an industry-wide scheme to limit patients' access to care by hitting physicians in the pocketbook for providing such access.

In contrast, in the physicians' suits, Moreno determined that the coding and payment methodologies used by the HMOs were similar enough to grant the doctors class-action status. Lawyers for the doctors are hoping to use the discovery process to uncover documents and obtain testimony backing their contention that the insurers set up systems to deny legitimate claims. Moreno instructed the attorneys in the doctors' case to agree on a mediator by October 30 and then report on whether any progress has been made in reaching a settlement by March 20 of next year. It is likely that both rulings by Moreno will be appealed.

James A. Hawkins is a health care writer based in Aiken, S.C. He can be reached by phone at 803/414-2062 or by e-mail at hir@ix.netcom.com.