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A key federal court ruling was expected at press time on a series of lawsuits against the HMO industry. Additionally, the nation's largest managed care operator reportedly is negotiating a settlement. The convergence may determine whether HMOs can put the worst of their legal issues behind them — or if the gates are opened wide for an onslaught.
Two years ago, lawyers who had brought the asbestos and tobacco industries to their knees set their sights on MCOs — filing more than a dozen suits on behalf of members. The suits against Aetna, Cigna, UnitedHealth Group, Humana, PacifiCare, and others differed, but the thrust of most was that HMOs created obstacles to needed care. Plaintiffs' lawyers are trying to have the suits certified as class action.
A judicial panel last October ordered that the suits seeking class-action certification be consolidated before being argued in U.S. District Court in Miami. There, Judge Federico Moreno last month heard arguments for class-action status. He is expected to rule shortly on whether to certify the suits — or dismiss them.
In a curious twist, at least one MCO, Aetna, is in settlement talks with several plaintiffs, even though the cases have not yet been certified as class-action suits. The Wall Street Journal quotes a lawyer close to the talks as saying that the discussions could bind Aetna to an agreement to end use of financial incentives that could inhibit access to care and drop use of clinical practice guidelines drafted by actuarial firms. The talks reportedly took on greater urgency as the Bush administration, which has said it favors passage of a patients-rights bill, settled in. Aetna did not comment on the report.
