The U.S. Supreme Court agreed in November to consider whether patients can bring suit against insurance companies and health plans when they refuse to pay for health care their doctors recommend.
The Court’s decision to hear the case could be the culmination of the “patients’ bill of rights” (PBOR) controversy that has swirled around Congress and engaged the lobbying efforts of the National Association of Health Underwriters, its members, and its allies for the past six years.
Right to Sue?
At issue in the two combined cases from Texas the Court agreed to examine is whether patients who believe they have been harmed have a right to sue their health plans in state courts for malpractice or some other tort. Or does the Employee Retirement Income Security Act of 1974 (ERISA) preclude such action by giving the federal government sole authority to regulate employee benefit plans?
It was precisely the issue of state versus federal responsibility for employee benefit plans that was the crux of patients’ rights legislation. Although competing versions of the legislation were approved by each house in recent years, Congress never passed a bill.
In 2002, the U.S. Court of Appeals for the Fifth Circuit, located in New Orleans with jurisdiction over Louisiana, Mississippi, and Texas, ruled individuals could sue in state courts. The court said plan decisions to pay for a treatment are both insurance and medical in nature, thus insurance companies and plans could be found liable under state statutes enforcing health care standards.
In their appeal to the Supreme Court, Aetna Health and Cigna HealthCare of Texas claim their coverage decisions are about insurance, not medical care. Making carriers subject to state courts for benefit determinations would violate ERISA, which was designed to ensure uniformity in the regulation of employee benefit plans nationwide.
The introduction during the opening days of each new Congress of legislation allowing patients to bring suit against their employers’ health plans has been as reliable as the cherry blossoms in Washington DC each spring. The passage of time, however, and the emergence of other health care issues have eclipsed PBOR.
The bill introduced in February 2003 by Representative Charles Norwood (R-Georgia) contained a provision creating an independent review panel for patients denied care by their health plan but, unlike past years, it contained no mention of liability. The lead cosponsor of previous PBOR legislation, Representative John Dingle (D-Michigan), said moving the most recent version of the bill in the absence of the liability language found in the past “would be like trying to move a car forward without the engine.”
Oral arguments before the Supreme Court are expected early this year with a decision due in June or July.
Tom Bruderle is vice president of congressional affairs for the National Association of Health Underwriters (NAHU). His email address is [email protected]. Reprinted with permission.