New Texas AG Weighs Next Move In HMO Lawsuits

New Texas Attorney General John Cornyn is considering how to proceed with his predecessor's eleventh-hour lawsuits against six HMOs, saying only that he will hold them accountable "if someone has broken the law." Cornyn, a Republican, received strong financial support from insurance companies during his campaign.

A common HMO utilization tool — financial incentives for physicians — is at the heart of the suits. Before leaving office Jan. 1, Attorney General Dan Morales accused HMOs of violating a 1997 state law that prohibits them from using financial incentives that "directly or indirectly [cause physicians] to limit medically necessary services." The suits seek fines to stop HMOs from using incentives in physician contracts.

The HMOs — PacifiCare, Humana, two Aetna plans and two NYLCare plans — say their practices comply with state law. Humana says its incentives were approved by the Texas Department of Insurance.

Subscribe to Our Newsletters

Monthly table of contents

Be notified as each issue of Managed Care is available online.

Biweekly newsletter

Recent topics have included:

PTCommunity news

New drug approvals, clinical trials, drug management. Weekly.