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An insurer can now be held accountable for their fair share of responsibility should a covered health care benefit be denied, delayed, or substituted by a managed care organization and harm results. SB 386 holds HMOs and other kinds of managed care organizations to the same legal accountability of physicians, hospitals and other health care professionals.
A managed care organization that did not make a health care decision is not responsible under this bill. The Act does not impose a duty on a managed care entity to provide treatment not covered by one's health care plan. Also, employers are expressly excluded from liability because employers don't make health care treatment decisions.
Internal and independent review processes must be exhausted before a patient can file a lawsuit. These and other measures, found in HB 971, The Medical Practice Liability Act of 1995, were included in the HMO legislation to deter frivolous lawsuits.
A managed care organization may not remove a physician from its plan (or refuse to renew their contract with a physician) for advocating medically necessary healthcare.
Further, a managed care entity organization is prohibited from entering into any contract with a physician, hospital or pharmaceutical company which includes a hold harmless clause for the acts or conduct of the managed care entity. Any such clauses in existing contracts are declared void.
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