NYLCARE: Decides To Pay $250,000 After Care Denial

      NYLCare Health Plans of the Mid-Atlantic Inc. will pay nearly $250,000 for the care of an Ellicott City, MD, boy whose specialized care the HMO initially refused to cover. The settlement is "one of the largest" reversals the Maryland Insurance Administration has obtained. The Baltimore Sun reports that NYLCare initially refused to pay when 13-year-old Justin Helwig was treated at Baltimore's Kennedy Krieger Institute for a rare digestive disorder. The facility was not "in the HMO's network of providers," but the boy's doctors determined that it was the "only facility in Maryland that had the capability to treat" the boy's complex disorder. Justin, who weighed 47 pounds at that time, then underwent seven months of inpatient care at the facility, "and then had a nine-month interruption in his care because NYLCare also refused to pay for outpatient services." His care was resumed when his parents switched health plans. Earlier this year, the Maryland Insurance Administration decided that "NYLCare had violated the terms of its contract with the Helwigs and provisions of Maryland law" and that it would have to repay the cost of Justin's care, which was covered by the state's medical assistance program.

Shifting Blame
      "NYLCare said it made a mistake in denying care to the boy," but also noted that "the incident could have been avoided if his parents, Stephen and Peggy Helwig, had formally appealed the decision." In fact, the Sun reports, "one of the most contentious issues in the case is whether the Helwigs and Kennedy Krieger appealed the initial decision ... to not pay the medical costs," which was made by a subcontractor of NYLCare. NYLCare's President and CEO Jeff Emerson said the family and the hospital did not appeal the decision. But, "[a]ccording to the judgment ordered by the insurance administration, the hospital appealed NYLCare's decision in November 1996." The Helwigs also said they contacted the insurance company numerous times.

Authorization & Access
      The Sun reports that the case is an illustration of "what can happen when a managed care company exercises its right to not pay bills incurred by clients -- or authorize treatment -- at facilities not in its network of hospitals and doctors." Nancy Fiedler, senior vice president of the Maryland Hospital Association, said, "This is clearly an issue society is trying to deal with in terms of access to health care." She added, "The insurer is primarily concerned with managing costs effectively. And the patient is more concerned with getting access to health care" (Murray, 5/27).