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February 24, 2002 at 07:00 PM
Miami Judge Keeps Managed Care Suits Alive
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A federal judge in Miami is letting consumers proceed with lawsuits against six managed care companies.
U.S. District Judge Federico Moreno threw out many allegations in the suits, but he kept claims dealing with the federal Employee Retirement Income Security Act, which governs many employee benefit plans, and the federal Racketeer Influenced And Corrupt Organizations Act, which lets plaintiffs collect extra damages from criminal enterprises.
All plaintiffs can proceed with charges that “gag rules,” or limits on doctors telling patients about plan financial incentives, violate ERISA, by breaching plans duty to act in participants interest. If an effort to suppress the information exists, it “is wholly incompatible with the spirit of proper plan administration,” the judge writes in his ruling.
Plaintiffs in states that recognize a private cause of action for insurance fraud can proceed with RICO claims, the judge ruled.
