PACIFICARE: New Suit Accuses Company of Deceptive Practices
Members of PacifiCare Health Systems HMOs filed suit against the giant insurer Tuesday in San Francisco County Superior Court, alleging the company uses false advertising and unfair business practices. The suit accuses PacifiCare of violating the California Consumer Legal Remedies Act by failing to disclose that it encourages physicians to avoid referring patients to specialists, which in turn keeps down treatment costs for the HMO. The suit also seeks a court order to prevent PacifiCare from further "unfair" practices, characterizing as "deceptive" the company's declaration that its "primary commitment was to maintain and improve the quality of health for its members." The suit, filed on behalf of 1.6 million California members, is the latest "legal assault" on health maintenance organizations in California and across the nation. Aetna, the nation's largest health insurer, and Humana are "targets of similar suits" (Bloomberg News/New York Times, 11/4).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.