MANAGED CARE: HMO Liability Bill Passes Assembly Health Committee

      A bill that would allow patients to recover damages from HMOs that injure them passed the state Assembly Health Committee Tuesday night on an 11-6 vote. The measure (AB 2436), introduced by state Assembly Insurance Committee Chair Liz Figueroa (D-Freemont), allows patients to recover damages from HMOs that "exercised influence or control which result in the failure to exercise ordinary care." According to Consumers For Quality Care, the remedies allowed under the bill skirt the Employee Retirement Income Security Act's preemption because damages are only allowed for quality of care violations or medical negligence -- which courts have upheld as within the state's province -- instead of damages for bad faith and other coverage disputes, which are preempted by ERISA. The bill now goes to the state Assembly Judiciary Committee (Consumers for Quality Care release, 4/15).