HMO Lawsuit

Health Management Organizations or Health Maintenance Organizations (HMO), are nothing more than insurance companies’ direct control over the healthcare system. They choose which patient can see which doctor and when.  It is also called "managed care."

We read about outrageous HMO actions every now and then, but anyone enrolled in an HMO knows that the control and interference an HMO injects into doctors’ orders, testing, and overall care, is an everyday occurrence.

Uneducated and poorly trained, HMO “representatives” – who more often than not seem to be glorified telephone-based bureaucrats - dictate to patients and their doctors what health services are covered, and too often, which health services are not covered and which the HMO will not pay. Of course, the consequences of a doctor having to answer to a non-health professional insurance telemarketer, can be catastrophic to the patient who does not receive the critical health care he or she needs.

Additionally the result is rationing healthcare – it destroys health care in several ways.

• Capitation: Capitation is a system that HMOs use to pay. A capitated physician is usually paid a set amount of money per patient on his or her “list” each month – commonly a very low amount -- comparable to minimum wage.  The result is that the only way a doctor can make more money is to have more patients on their list; however, the more patients on the list, then the less time they can spend with each and greater the chance that malpractice will occur.  This is also why HMO physicians’ waiting rooms are always packed, and the wait to see them is so long.

• Financial Disincentives: The capitation terms of a doctor’s contract with the HMO often include financial disincentives so the doctor does not order testing.  These contracts often contain a list of common testing procedures that must be paid out of the doctor’s own pocket if ordered. Ordering tests can actually cost the doctor more than he or she makes for the year of having the patient on their list. This creates a serious disincentive to perform necessary testing and follow-up.

• Preferred Provider Status: Third, doctors want to maintain their “preferred provider status.”  HMOs rate their doctors based on their “utilization” (monitoring how much a doctor costs the HMO in test requests and hospital stays).  If the doctor orders too many tests, hospital stays, referrals to specialists, or procedures, which the HMO may consider to be too much, then the doctor can lose his/her preferred provider status. As a result, the doctor loses a large portion of his/her HMO patients. This is another situation that can force a doctor to choose between the hand that feeds them and the best interest of the patient.

• HMO Medical Decision:  Unbelievably, HMO do medical decisions.  Many times hospital stays and expensive testing or treatment must be pre-approved by the HMO – and often they say no.” In HMO-speak, this is just a “denial.” Often, the HMO simply deems the test or procedure to be “unnecessary” or “experimental.”

These uneducated HMO representatives making health care decisions – second-guessing doctors and patients – which result in permanent harm or death – are outrageous. The trillion-dollar insurance industry, which reports annual profits in the tens of billions every year (often larger than oil companies), has effectively distorted a federal law called ERISA to protect themselves from some lawsuits.

The Federal Employee Retirement Income Security Act (“ERISA”) 29 U.S.C. § 1001, is a federal law that was originally designed to protect people from big insurance companies. Nowadays, however, a very small section of this huge act provides that an individual merely has the right to file a grievance against their HMO.

Another small provision of the law says that ERISA preempts – or voids – more favorable State laws.  Some courts have put these two together and concluded that ERISA’s right to file a grievance against an HMO preempts state medical malpractice law and prevents an injured person from suing the HMO that hurt them.

Have you been injured or lost a loved one due to an HMO delaying a test or referral to a specialist, or denying insurance coverage for a particular procedure? Has the HMO’s poor decision-making resulted in catastrophic injury or death? Contact me today.

While the situation is frustrating and screams out for justice, it is more difficult than you might expect to successfully sue an HMO. Contact me for a free consultation and I will evaluate your case and your rights under your circumstances.

Remember, ERISA does not apply to everyone. There are important exceptions and persons exempted from the ERISA monster.

Who Can Be Held Accountable?

If a particular claim is covered by ERISA, then in many instances you cannot sue the HMO under State law for the doctor's medical malpractice negligence. This means you can only bring a lawsuit in State court against the doctor, not the HMO.

In Florida, the legislature has gone out of its way to provide amnesty to HMOs – and further harm the consumers. Florida has tried to limit the liability of HMOs where the insurer does not directly employ the physician who committed the malpractice (Fla. Stat. § 768.0891).

Some state laws hold health plans liable for patient harm when they have failed to exercise what's called "ordinary care" in making treatment decisions, making HMO plans liable for harm caused by treatment decisions made by employees, agents or representatives over whom they had influence or control. And in some states, HMOs can't drop a doctor from its panels or refuse to renew a doctor's contract because he or she stuck up for a patient. If you're lucky enough to live in one of the states that allows lawsuits against HMOs, you may be able to sue for malpractice.

In States that allow lawsuits against HMOs, you may be able to recover the cost of additional medical treatment, lost wages (current and future) and the pain and suffering you endured and continue to have as a result of your injuries. In some states, you may also be able to recover what's called "punitive damages," designed to punish the HMO or insurance company for outrageous practices.

If you believe an HMO or insurance company has improperly denied your claim, refused to cover an important medical procedure or surgery, or otherwise injured you or a loved one, contact us -- now.

HMO claims denials, HMO malpractice, insurance managed care abuse, often result in harms to the consumer. Protect your rights, assert your rights, and fight the HMO bureaucrats. Contact our consumer injury attorneys today.

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We provide aggressive, prompt, and ethical advocacy on behalf of individuals and families who have suffered serious personal injury, accident injury, and wrongful death. Contact us today.

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