Texas trial: HMO liability law

Texas was the first state to pass a health plan liability law. What has the impact been, and is it a model for the nation?

By Geri Aston, AMNews staff. May 28, 2001.

For the sixth year, the issue of health plan liability is stymieing passage of a patients' bill of rights in Congress. But if states provide the testing ground for health reforms, then the evolving experience in Texas -- the first of eight jurisdictions to enact health plan liability laws -- may offer important clues about what may or may not work on the national level.

Supporters of the cause say Congress need only look to Texas to see how the worst fears about plan liability -- defensive medicine, a flood of lawsuits and skyrocketing insurance prices -- are unfounded. But opponents say it's still too early to gauge the impact of the 1997 law.

The statute has drawn more attention with the election of President Bush, who has vowed to work for passage of federal patient protection legislation similar to the package he allowed to become law as Texas governor. So what has been the impact of the 4-year-old Texas statute on physicians, patients and plans?

For physicians, the answer often strikes at the heart of their ability to practice medicine. And many point to tangible improvements.

Robert Gunby, MD, a Dallas obstetrician-gynecologist, says the biggest change is a move away from automatic treatment denials by health plans. Before, "their philosophy was to deny everything, and you had to call back and plead," he says.

To explain, he recounts the tale of a patient who hemorrhaged so badly with each menstrual cycle that he recommended a hysterectomy. He would boost the patient's iron count enough through supplements to make surgery safe, only to have the plan deny surgery because the patient's iron count was too high to warrant the procedure. [...]