Far from becoming a bonanza for avaricious trial lawyers, the right to sue an HMO or insurance company in Texas has been exercised just 17 times. Eleven of those lawsuits have been tried, to one degree or another, by Fort Worth attorney George Parker Young. Its been very beneficial, Young says. Weve seen the HMOs back down and be quicker to approve necessary care.
One factor contributing to the seeming success of the Texas law has been the establishment of independent review organizations that consumers can submit complaints to before entering the legal system. Of the 3.9 million Texans enrolled in insurance plans, fewer than 1,400 have logged any sort of formal complaint or appeal against a decision by an HMO or insurance company.
Though not required to do so by lawthey could go right to court if they wantedmost of those with a problem have sought redress through the independent review systems. From November 1997 through May 2001, independent review doctors have considered 1,349 complaints. In 672 of these assessments, or 50 percent, the independent review overturned the HMO or the insurance companys original ruling. In 567 cases, or 42 percent, the independent review upheld the HMO or insurance companys ruling. In 110 cases, or 8 percent, there was essentially a split decision.
While Texas HMO premiums have increased over the years, the 1997 Patient Protection Act was not really a factor in the increases, says Lee Jones, assistant director of the public information office for the Texas Department of Insurance. Over a period close to four years, to have only 1.300 or so independent reviews is just not going to be that much of a cost-driver, he says. Larger factors in increased rates include the rising costs of prescription drugs and medical care.
The Texas law caps rewards for plaintiffs at $750,000 in punitive damages. Kennedy-McCain-Edwards caps the punitive damages at $5 million; the House version of the bill has no caps on punitive damages.