CONNECTICUT: Attorney General Files Suit Against HMOs
Connecticut Attorney General Richard Blumenthal (D) filed a federal class-action lawsuit yesterday in U.S. District Court against four of the state's largest managed care companies, claiming they sacrifice patient care quality for profits, the Wall Street Journal reports. Blumenthal alleges that the Connecticut subsidiaries of Cigna Corp., Oxford Health Plans Inc., Anthem Inc. and Foundation Health Systems Inc. have obstructed access to medically necessary prescription drugs due to their use of drug formularies; fail to reimburse providers in a timely fashion; failed to respond promptly to members' questions; failed to disclose important information about their plans; and used arbitrary guidelines to deny claims. The suit also alleges that the companies violated the Employee Retirement Income Security Act of 1974. The insurance giants denied each of Blumenthal's claims, and Oxford and Cigna expressed disappointment that he had not contacted them prior to filing suit. "Had he done so, we are confident that he would have found" Cigna's practices "among the best in the industry," according to a Cigna statement. A Foundation Health Systems statement said that Blumenthal's suit "will not serve consumers' interests but instead create barriers to access and increase costs." Still, the attorney general responded that he has amassed an "overwhelming" amount of "current and powerful" evidence in the past six to 12 months. Blumenthal's lawsuit does not seek monetary damages, but aims to "force reforms in the managed care industry" (Martinez, 9/8). The four national HMOs collectively provide coverage to more than 800,000 Connecticut residents, and Blumenthal said he filed suit on behalf of "thousands of clients who have suffered physically and financially from the organizations' practice of putting profits ahead of patient care" in what has become "a pattern of conduct that has denied essential medical treatment to patients." A district court judge determine whether the lawsuit meets legal criteria for class-action status, and if so, Connecticut would become the first state to file such a suit against managed care companies and the first to do so on behalf of consumers, Blumenthal said (Zielbauer, New York Times, 9/8). In August, a U.S. District Judge ruled against another Connecticut suit that accused Physicians Health HMO of forcing patients to use preferred drugs, regardless of others that may be safer or more effective (Wall Street Journal, 9/8).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.