Associated Press State & Local Wire
Patients denied medically necessary treatment by their HMOs could sue the managed-care plans for damages under landmark legislation backed Wednesday by the California Legislature.
Similar bills passed by the Assembly and Senate would give patients power that federal law now denies to most people covered by employer-sponsored health plans.
“It’s a huge step forward for patients,” said Jamie Court of Consumers for Quality Care, which has long sought the legislation.
Federal law blocks most lawsuits seeking damages against employer-sponsored health plans, including those over inappropriate denial of medical treatment by HMOs.
Health maintenance organizations and other managed-care plans limit patients’ choice of doctors in exchange for lower premiums and lower fees for checkups and prescriptions.
California is among at least 30 states debating whether to give consumers the right to sue HMOs for damages. A Texas law allowing malpractice lawsuits against the plans was enacted in 1997.
“HMOs will be much more likely to defer to patients’ needs and doctors’ requests for medically necessary treatment because they will fear the hammer of damages if they don’t do the right thing,” Court said.
Opponents said the measures would cause health care costs to skyrocket without really helping patients.
Sen. Bill Morrow, R-Oceanside, argued it “would open the floodgates of litigation.”
The bills, sponsored by Sen. Liz Figueroa, D-Fremont, and Assemblywoman Carole Migden, D-San Francisco, passed with only Democratic support.
The Assembly passed Migden’s bill 41-25, while the Senate backed Figueroa’s 21-16. Each proposal needs approval from the other house before it can go to Democratic Gov. Gray Davis, who has not said whether he would sign either of them.
Figueroa said the right-to-sue bills would give patients with grievances against their HMOs a much needed avenue to address them.
“The sky will not fall,” she said.
A managed-care group called the proposals a step in the wrong direction.
“Expanding health care liability is the wrong solution to the real problem of consumer concern over health care,” said Cory Black of the California Association of Health Plans.
Black did support other legislation approved Wednesday that would let patients denied treatment by their health plan appeal to an independent review panel.
“We believe independent external review is a faster, more expedient way to get our members the health care they need when they need it,” Black said.
A Senate measure, sent to the Assembly on a 21-11 vote, would set up a system under which a medical reviewer would evaluate the case and rule on whether the denial of care was appropriate.
The decision would be binding on the HMO or health insurer.
Current law provides such an appeal process for terminally ill patients who are denied coverage for experimental or investigational therapies.
The bill by Sen. Adam Schiff, D-Burbank, would cover any health plan decision denying, delaying, limiting or terminating treatment proposed by the patient’s physician.
Migden’s Assembly-approved bill also would create an independent system to review consumer complaints.