Landmark legislation providing a remedy to patients who are denied or delayed treatment by their HMO and suffer significant harm passed its final hurdle with a concurrence vote of 22 to 9 in the California Senate. Significant harm is defined as “loss of life, loss or significant impairment of limb or bodily function, significant disfigurement, severe and chronic physical pain, or significant financial loss.” Governor Davis said he would sign the compromise bill.

SB 21 (Figueroa), sponsored by the Foundation for Taxpayer and Consumer Rights (FTCR), is the culmination of a three year campaign by the Foundation to establish legal accountability for HMOs in California.

“HMOs should take this legislation as a warning sign that when they seriously compromise the quality of a patient’s care they will be accountable for damages,” said Jamie Court, advocacy director for FTCR. “The threat of significant damages should change HMO misconduct and if it doesn’t we will be back to propose even stronger remedies for patients. This legislation will work so long as HMOs fear it and stop stonewalling medically necessary treatment. Seriously harmed patients will now have a big stick to wave at their HMO. Hopefully they will never have to use it. ”

HMO Oversight To Test Administration’s Resolve

Other HMO bills moving forward today include establishment of a new department of managed care oversight, an independent review system and various mandate bills.

“HMO liability is the strongest of the reforms passed today that will help mistreated patients have more leverage at any juncture in the medical delivery process,” said Court. “The test of this Administration will be how well it implements a new oversight structure that is housed under the Business, Transportation and Housing Agency. The cabinet secretary responsible for HMO oversight is a former board member of Blue Cross of California, Maria Contreras Sweet. This Administration’s resolve will be tested by how much money and personnel it pumps into HMO oversight.”

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