HMO ‘DECEPTION’ CASE: Supreme Court To Decide On Jury Trial
The California Supreme Court agreed yesterday to tackle a "high stakes" health care issue, "decid[ing] whether patients can get a jury trial on claims that they were lured into an HMO on false pretenses and suffered bad care," the AP/Sacramento Bee reports. Although HMOs have avoided court trials by relying on arbitrators to decide patient disputes, a Los Angeles state appeals court in June ruled that a Long Beach family could take Cigna Healthplans of California to court ( see CHL 7/2), rather than an arbitrator, on a claim that the insurer engaged in false advertising. The Supreme Court "set the appellate ruling aside" and agreed to a hearing after an appeal from Cigna. The case under consideration is unusual because it "attempt[s] to sidestep the arbitration requirement by claiming a violation of a state law against deceptive business practices" that "entitles a victim to a trial by a jury trial for damages" and stipulates that "its protections cannot be waived by an individual consumer." The plaintiff, Keya Johnson, whose baby became lodged in her birth canal during childbirth, charged that the baby "should have been delivered by Caesarian section, and was born brain-damaged and paralyzed in one arm." Johnson filed a malpractice claim which fell under the jurisdiction of an arbitrator, but in addition, she sued Cigna for false advertising. According to Johnson, she enrolled with Cigna after a solicitor "induced her to join by promising that she would have better care and one doctor," however, she claims she received medical care from a physician's assistant. The 2nd District Court of Appeals ruled the false advertising claim could proceed to court, in light of the ban on waiving consumer protection. After the ruling, Cigna warned the decision would "'potentially open the floodgates' to attach deceptive-practice claims to routine malpractice suits -- or to other suits involving arbitration contracts, such as securities and employment disputes" (Egelko, 10/1).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.