Florida high court may rule if doctors can sue over late pay

A physician group claims that insurers did not follow state laws, and now they're seeking damages as third-party beneficiaries to the patient-HMO contract.

By Mike Norbut, AMNews staff. Sept. 26, 2005.

In a case that could have a profound effect on physician reimbursement in Florida, the state Supreme Court is expected to decide whether doctors can bring claims against insurers under the prompt-pay law.

While the court has not officially accepted the case, attorneys on both sides expect that it will. If the court rules in the physicians' favor, they say it will add teeth to a law they have been trying to strengthen for years and give doctors a chance to put more pressure on insurers to pay their claims fully and on time. If the court rules in favor of the HMOs, physicians fear they will have to deal with current delays and unexplained denials while trying to push for a legislative change.

HMOs in the case, Foundation Health et al. v. Westside EKG Associates, claim private groups do not have the right to enforce the prompt-pay law in court by filing a lawsuit. But physicians argue they are entitled to do so because the insurers breached their contracts by denying and underpaying claims.

"What they're saying is even if they [HMOs] violate the prompt-pay law, neither doctor nor member can question them in a court of law," said Jeff Liggio, a West Palm Beach, Fla., attorney representing the physicians in the case. "But very simply put, if you violate the statute, you breach the contract."

Florida's Fourth District Court of Appeal sided with the doctors in May. In that case, the court unanimously ruled that doctors could assume the role of third-party beneficiaries and sue HMOs for not complying with the prompt-pay law. But the court sent the question to the Florida Supreme Court to consider, deferring to the state's high court because the topic is "one of great public importance."