News and Commentary

First Major Ruling About Financial Incentives Upheld

It's Managed Care 2, Lawyers 0, in the question of whether ERISA requires health plans to disclose physicians' financial incentives. The U.S. Fifth Circuit Court of Appeals upheld a lower court ruling that dismissed a case against several HMOs. Health plans still face a number of class-action suits, however, over various types of incentives; one of those cases is to be argued before the U.S. Supreme Court this month.

At the state level, the Washington Supreme Court upheld a law requiring health plans to cover certain alternative services, including naturopathy, massage therapy, and acupuncture. Health plans had fought the 1996 law, but state Insurance Commissioner Deborah Senn championed it as a matter of choice of provider. The U.S. Supreme Court has refused to hear an appeal.

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