Supreme Court has chance to hold HMOs accountable.

At issue is a federal statute that health plans have used to protect themselves from state medical malpractice laws.

Editorial. Dec. 8, 2003.

The U.S. Supreme Court next year may answer the biggest question in the decade-old debate over health plan accountability -- can patients sue their plans for injuries caused by the denial of doctor-recommended treatments? The justices have agreed to hear two cases next year in which patients are suing their insurers under the Texas Health Care Liability Act.

For too long, health plans have used a federal law, called the Employee Retirement Income Security Act, as immunity from bad medical judgment calls. ERISA, passed in 1974 before managed care caught on, was intended to provide nationwide uniformity in the regulation of employee benefit programs. Managed care plans have used it as an enormous and powerful loophole to get out from under state medical malpractice laws.

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In the past three years, the federal courts have gradually chipped away at the previously impervious ERISA shield. But confusion about health plan liability remains.

For the AMA and other medical groups, the right path could not be more obvious. If an insurer is going to play doctor, it should be held accountable in the same way a doctor would be.

Take the cases at hand. Juan Davila alleges that he developed bleeding ulcers and nearly had a heart attack when his HMO, Aetna Health Inc., refused to pay for the Vioxx his doctor prescribed for arthritis until after he tried other drugs.

Ruby Calad claims that her HMO, CIGNA HealthCare of Texas, decided that she should be discharged from the hospital earlier than her doctor recommended after a complex hysterectomy. Complications sent her to the emergency department just days later. Both Davila and Calad contend that they were harmed by their HMOs' medical decisions and that the insurers should be held liable in state court.

Health plans, however, argue that they decide what to pay for based on coverage rules, and sometimes the treatment a patient needs is not covered. Patients can pay on their own for recommended treatments that are denied, insurers say.

But many patients don't have the financial wherewithal to pay for expensive medical care. A coverage denial for them is, in effect, a care denial.

Further undermining plans' arguments is the reality that decisions about what is covered are entwined with medical necessity. Insurers will pay only for medically necessary treatments, and they reserve the right to determine what is and isn't necessary -- instead of relying on the treating physician's judgment. In these situations, the decision not to cover a treatment is not an administrative ruling. It is a medical decision.

Plans also argue that independent reviews by expert panels are a better and less costly way than litigation to handle disagreements between insurers and patients and their doctors.

These appeals systems are indeed helpful. The states that allow patients to sue health plans require patients to go through the appeals process first in most cases. The majority of disputes are worked out at this level.

But a nonjudicial appeal doesn't help someone who already has been injured at the hands of his or her health plan. Lawsuits are a necessary last resort for patients with grievances.

Whether patients will secure the right to this highest level of health plan accountability is now up to the Supreme Court. Regardless of the outcome, the justices' ruling may well fundamentally affect the most crucial aspect of the physician-patient relationship -- the ability to make the best medical decision for the patient.