HMO ordered not to withhold payments to podiatrists

The Illinois Supreme Court distinguishes between a corporate registration and a professional license.

By Mike Norbut, AMNews staff. Nov. 14, 2005.

An HMO cannot refuse to pay claims filed by a group of incorporated podiatrists because the group did not have an updated corporate certificate, the Illinois Supreme Court ruled this fall.

The decision, which reversed rulings by courts on both the trial and appellate levels, offers significant protection to physician groups because it distinguishes a state-issued corporate certificate from a medical license.

That means "just because your corporate entity doesn't have a $50 piece of paper," an insurance company can't hold that against you, said John Roberts, the podiatrists' attorney from Wildman, Harrold, Allen & Dixon in Chicago.

"The court saw the certificate as a revenue-generating mechanism not designed to protect the public safety," Roberts said.

Illinois law, which is similar to many states, requires that medical professionals who form corporations register with the state's Dept. of Professional Regulation annually. Doctors receive a certificate with a completed form and $50.

That piece of paper does not carry the same importance as a professional license, the court ruled in Chatham Foot Specialists PC vs. Health Care Service Corp., d/b/a BlueCross BlueShield of Illinois.

The September ruling stems from a 2001 case in which the podiatrists accused BlueCross BlueShield of breaching its contract by intentionally and systematically withholding payments for services.

The Blues asked the court to dismiss the lawsuit, arguing that the podiatry group did not have standing to sue because it did not have its annual corporate certificate of registration required under the Illinois Medical Corporations Act. A Blues spokesman declined comment, citing Blues policy not to discuss pending litigation.