Managed Health Care and You

Many individuals receive their major medical insurance through an employee benefit plan. Often, these employee plans are subscribers to a Health Maintenance Organization (HMO). In these cases where a person receives their medical coverage through their place of employment, their rights to certain benefits and ability to pursue a legal action against an HMO for the negligence of one of its care providers may be governed by the federal law known as the Employee Retirement Income Security Act of 1974. ("ERISA").

What many people do not know is the ERISA preempts or prohibits individuals from maintaining a claim in state or federal court against an HMO if the treatment was rendered and "relates to" an employee benefit plan. Current estimates are that 7 out of 10 Americans are covered by the managed care industry. Many states are beginning to pass legislation which would permit a claimant to sue not only the physician who may have provided treatment below accepted standards, but also the HMO which permitted the physician to practice within the network, referred the patient to the physician and made the determination whether the proposed treatment was appropriate and covered by the plan.

Similarly, many federal and state courts are split on the validity of the provision of ERISA, prohibiting negligence or professional malpractice claims against managed care insurers under state law.

The issue is an important one. Recently, the American Medical Association released a seething letter it sent to Aetna – U.S. Healthcare, accusing one of the country's largest managed care insurers of interfering with physicians' treatment decisions for patients and compromising the care of the patient. The American Medical Association concluded that many of the contracts offered to the physicians by the insurer were one-sided and prohibited physicians from discussing valid medical treatment options with patients which were not covered by the plan. Furthermore, the AMA charged that many plans prohibit physicians from providing choices of treatment and do not permit subscriber patients an avenue of appeal if recommended treatment is denied.

If you have been denied recommended treatment due to a denial of coverage by a managed healthcare entity and the denial of treatment has resulted in a harm by way of a delay in diagnosis or misdiagnosis, please call the LAW OFFICE of GARY D. GINSBURG at 609-727-1991 to discuss your rights. We are located at The Atrium II, 3000 Atrium Way, Suite 101, Mt. Laurel.