Court Gives HMO Patients More Rights

an Associated Press article from NANDO Times

WASHINGTON (August 14, 1998) - As the White House pressed Congress to guarantee patients certain rights from their HMOs, a federal appeals court has told the administration it must provide even more rights to Medicare beneficiaries.

Acting on a national class-action suit, a three-judge panel said the federal government is responsible for assuring Medicare patients are given due process in their dealings with HMOs.

In practice, that means the government must make sure these companies give patients more information about benefits, immediate hearings to appeal denials of care and quicker decisions on appeals.

The 9th U. S. Circuit Court of Appeals panel went even further, ordering Wednesday that notices of appeal rights be written in type large enough for older people to read and that rulings on requests for services must be made within five days.

The San Francisco-based court also ruled that the Department of Health and Human Services must not renew contracts with HMOs that deny care to Medicaid patients without giving them a reason or a chance to appeal quickly.

Looking to cut costs, the private sector has embraced HMOs and other managed care plans that restrict health spending and pass along the savings. Hoping to reap similar savings, the government is encouraging senior citizens to sign up for Medicare HMOs, which usually offer extra benefits but come with some restrictions.

Complaints in the private sector about these restrictions have spurred demands for government action, as Congress debates a "patients' bill of rights" meant to force companies to pay for certain treatments, allow broader access to doctors and guarantee independent appeals.

The Medicare case reflects similar concerns. It was brought in 1993 by five elderly Arizona women who said they were denied care and denied the right to appeal the decision quickly.

One woman who suffered from diabetes complained of pain in her foot but received no response from her HMO doctor. Later, after part of her leg was amputated, the HMO refused to provide her home health care, even though she needed intravenous medication at home.

A second patient was refused an ambulance after suffering a broken back at home. A third was turned down for physical therapy after hip surgery and two others were denied nursing home care payments.

About 17 percent of Medicare beneficiaries have enrolled in HMOs, but that figure is rapidly rising and is expected to hit 25 percent - or 10 million people - by 2002.

President Clinton has already acted by executive order to guarantee Medicare patients certain rights, including quick appeals.

While the administration did not object to giving patients these rights, it argued in the appeal that the federal government should not be held accountable for decisions HMOs make. An HMO should not be considered "an agent of the government," HHS spokesman Campbell Gardett said Friday.

But the appeals court disagreed in its unanimous upholding of a lower court ruling.

"HMOs and the federal government are essentially engaged as joint participants to provide Medicare services," Judge Charles Wiggins wrote for the court.

The government pays HMOs to treat Medicare patients within a framework of laws and regulations that allows the government to overturn HMO decisions.

"We're delighted, and we think the decision is going to make things better for lots of Medicare beneficiaries around the country," said Sally Hart Wilson, attorney for the Center for Medicare Advocacy Inc., of Tucson, Ariz., which brought the suit.