WASHINGTON, D.C. — Consumer Watchdog joined with the parents of a 17 year-old who died after her health insurer, CIGNA, denied a liver transplant to call on Congress to close the legal loophole that bars her family and 132 million Americans from having their day in court. The lack of accountability allows health insurers to deny access to care without fear of reprisal when private employers pay for health coverage.
Today’s Los Angeles Times reports how the family of Nataline Sarkisyan was prevented from going to court over her death because of a legal loophole that bars any damages against health insurers for wrongful death or injury when health insurance is provided through private sector employment. However, Nataline’s family was allowed to refile a lawsuit for emotional distress because an insurance executive made an obscene gesture to the family at a rally outside of CIGNA’s headquarters.
Read today’s Los Angeles Times story about the Sarkisyan.
"Congress cannot force Americans to contribute to employment-based health insurance, then deny them legal accountability when an insurer denies or delays treatment to boost profit," said Jerry Flanagan of Consumer Watchdog. "You can sue an insurance executive if he flips you the bird, but most Americans can’t sue their health insurer if the company kills a loved one. Any health care reform must end this health insurer immunity, but no legislation has yet tried to."
Watch a video clip of former CIGNA insurance executive turned whistleblower, Wendell Potter, telling the story of Nataline Sarkisyan.
Under a 1987 Supreme Court decision in Pilot Life Insurance v. Dedeaux, which interpreted the Employee Retirement Income Security Act (ERISA), victims can only recover the cost of the procedure or service denied in the first place—no damages or penalties are allowed. Since Nataline’s health insurance was provided by her father’s employer and Nataline died before receiving her liver transplant, the family could recover nothing.
Government officials, individuals who buy health insurance policies on their own and those that work for religious organizations may sue health insurers in state court for denials of care and seek damages.
"I want to get rid of this ERISA law," Hilda Sarkisyan, Nataline’s mother, told the Los Angeles Times, "and replace it with Nataline’s law."
Read Consumer Watchdog’s letter to Congress demanding an end to the insurance industry’s get-out-of-jail-free card.
Legal Accountability: The Missing Link
Senator Edward Kennedy championed a federal effort to provide more legal accountability to the health insurance industry. Kennedy’s bill passed the Senate but died in the House in 2001.
On June 19, 2001, Senator Kennedy gave his opening speech to Congress on S. 1052, which would have allowed patients to hold health insurers financially accountable when they cause harm. Kennedy told his Senate colleagues:
"Patients should have the right to hold their HMO accountable in court when its negligence causes the injury or death of a patient. No other industry in America enjoys immunity from accountability for its actions, and the insurance industry does not deserve it either. Few, if any, provisions will do more to guarantee that your HMO does the right thing than the knowledge that it can be sued if it does the wrong thing."
However, none of the current health reform bills provide legal accountability of health insurers
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