Supreme Court Rejects Patient Lawsuits Against HMOs

The U.S. Supreme Court unanimously rejected lawsuits filed by two HMO patients in Texas who wanted to sue for malpractice because the insurers failed to pay for recommended medical care, the Associated Press reported June 21.

Patient rights advocates and trial lawyers were not pleased with the ruling, saying it removed an important tool for keeping insurers honest.

The patients filed their lawsuits citing Texas patient-protection laws. But the Supreme Court said the laws don’t allow patients to seek damage awards in state courts. Instead, the Supreme Court ruled that such cases should be handled in federal court, with damages limited to the value of whatever benefit the HMO denied.

In making its ruling, the Supreme Court cited the 30-year-old federal Employee Retirement Income Security Act (ERISA), which requires HMO patients to sue in federal courts.