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June 21, 2001 at 08:00 PM
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A federal judge in Miami has thrown out some of the claims in a group of lawsuits accusing managed care companies of fraud.
U.S. District Judge Federico Moreno dismissed charges that the companies had violated the federal Employee Retirement Income Security Act, and he also dismissed most charges accusing the managed care company defendants of violating the federal Racketeer Influenced and Corrupt Organizations Act.
Defendants that lose RICO cases may be required to pay the plaintiffs damages equal to three times the actual damages.
But Moreno gave the plaintiffs until June 29 to try to persuade him to reinstate the RICO charges, and he let plaintiffs continue with RICO allegations against Humana Inc., Louisville, Ky.
Moreno said he would hear arguments on July 24 about whether to let the plaintiffs continue their suits as class actions.
The HMO companies must respond to the amended complaints by July 27.
The defendants in the cases are Humana; Aetna Inc., Hartford; Foundation Health Systems, Los Angeles; PacifiCare Health Systems Inc., Santa Ana, Calif.; Prudential HealthCare, Roseland, N.J.; and United Healthcare, Minneapolis.
The court tilted the balance slightly in favor of the managed care companies, by agreeing with them that the plaintiffs had failed to show that they had exhausted all administrative means to solve the disputes, or that seeking such solutions would be futile, analysts said.
But, because Moreno is permitting the plaintiffs to replead portions of their cases, the ruling is a mixed bag for the managed care companies, according to Robert Mains, an analyst with Advest Inc., New York.
