Senate Committee Approves HMO Patients’ Right to Trial in California

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The California Senate Judiciary Committee, by a 4-to-2 vote, has approved legislation giving HMO patients the right to go to court. Currently, most HMO’s force patients into binding arbitration as a condition of health coverage. SB 458 (Escutia) guarantees that a patient has the option of having their case heard before a jury or judge if they sue under California’s new right-to-sue law.

“This is the first step in guaranteeing that HMO abuses are not kept secret in a binding arbitration process, where the public has no eyes and has no voice.” said Jamie Court, Executive Director at the Foundation for Taxpayer & Consumer Rights. “When HMO’s commit corporate negligence, they should be accountable to a jury or judge, not to an arbitrator who receives repeat business from the HMO if his work is valued.”

The bill now goes directly to the Senate floor.

“This isn’t premature, it’s two years too late.” said Sara Nichols, Legislative Advocate for the California Nurses Association. “Our patients and our workers already think they have this right.”

Patients would have the right-to-sue under the new HMO liability law that was effective January 1, 2001. That law gave patients the right to recover damages against an HMO, which is a right most patients have not previously had. However, HMO contracts have forced these cases to be heard in binding arbitration, rather than in a court.

The Foundation for Taxpayer & Consumer Rights is a non-profit, non-partisan consumer watchdog group based in Santa Monica, CA.

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