High Court To Hear Cases On Managed Care Suits
The United States Supreme Court has agreed to decide whether managed care patients can sue their plans in state courts for negligence arising from adverse medical necessity decisions.
At issue is whether state court actions against employer-sponsored health maintenance organizations are preempted by the Employee Retirement Income Security Act.
In two casesAetna v. Davila and Cigna v. Caladthe Fifth Circuit Court of Appeals ruled that ERISA does not preempt state law actions when HMOs make decisions that involve both eligibility and treatment.
Thus, the Fifth Circuit said, the patients in the two cases can sue their plans in state court for failure to use ordinary care in making decisions on medical necessity.
In one case, Ruby Calad, who was covered by a Cigna health plan, underwent a hysterectomy. Cigna allowed her a one-day hospital stay, which is standard, although the attending physician recommended a longer stay.
Calad suffered complications and had to return to the hospital a few days later. She charged that the complications were caused by her early release.
In the other case, Juan Davila, who suffers from diabetes and arthritis, was covered by an Aetna managed care plan. His physician prescribed the medication Vioxx for Davilas arthritis pain. According to the Fifth Circuit Court of Appeals, studies show that Vioxx has a lower rate of gastrointestinal toxicity than other drugs on Aetnas formulary.