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HMOs Protected Under Federal Law In a unanimous decision rendered today, the U.S. Supreme Court ruled patients cannot sue their health maintenance organizations under federal law for giving doctors bonuses to reduce costs. Although the ruling gives patients no legal recourse in federal courts, patients still have the right to sue HMOs in state court. The nine justices barred a lawsuit from an Illinois woman who claims her physician's delay in ordering some diagnostic tests led to her appendix rupturing. The Supreme Court stated that federal law does not give the plaintiff, Cynthia Herdrich of Bloomington, Ill., the right to sue her HMO on the claim that the company failed to act in the patient's best interest. The court stated that Congress created HMO practices, which are structured to make a profit and keep treatment costs to a minimum. To have ruled in favor of the plaintiff, the court says, would be to act against Congressional policy. Congress is embroiled in a debate over whether patients should have the right to sue their HMOs in federal court. Many Democrats support patients' right legislation that would give Americans legal recourse against their managed care company in federal court. Many Republicans aren't in favor of the right to sue and argue such a right would drive up health-care costs. The case, Pegram vs. Herdrich, began in 1992 when Herdrich sued Carle Clinic Association, claiming that her doctor waited eight days to get the needed diagnostic tests performed at a facility owned by the HMO, and that the delay led to a ruptured appendix and peritonitis, or inflammation of the abdomen. Under Illinois law, Herdrich was awarded $35,000, but she sued under a federal law called the Employee Retirement Income Security Act, which requires health care companies to act in the patients' best interests. --By Katrina Woznicki |
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