TEXAS: Judge Denies Sanctions for HMO Medical Director
U.S. District Judge Barbara Lynn ruled that the Texas State Board of Medical Examiners may not punish the medical director of UnitedHealthcare's North Texas unit for his decision to deny home health care to a 13-year old patient, because the director made a "coverage decision," not a "treatment decision," the Dallas Morning News reports. In her explanation, the Dallas judge said that Dr. David Ellis, known as John Doe in the lawsuit, "never diagnosed, treated or offered to treat" the boy whose physician recommended a home ventilator and home nursing services, "[n]or did Doe recommend treatment or make any finding of medical necessity." Instead, Ellis determined that the services described by the boy's physician were not "reimbursable under the terms of the plan." Judge Lynn also cited the Employment Retirement Income Security Act, saying that in coverage decisions, federal law preempts state agency authority. The patient's parents filed a complaint with the Texas Board of Medical Examiners asserting that an HMO medical director should not substitute his medical judgement for the treating doctor's opinion. "The issue before the court was never a medical benefits issue," Mark Wiser, the father of the patient who died in September 1998, said, adding, "Having HMO medical directors overrule treating physicians based on arbitrary rules or rationing medical care due to financial concerns is a threat to the public safety" (Shah, 9/13). The medical examiners board voted to suspend Ellis' license for improperly denying care in what was the first suspension of an HMO chief physician in the United States ( California Healthline, 4/18), but UnitedHealthcare sued the board to prevent its discipline, and will now seek an injunction to thwart state sanctions to its unit medical director. Of the ruling, Texas Medical Association lobbyist Connie Barron said, "The important thing is that she's not saying that a doctor exercising medical judgement is not subject to the regulators. We think that if you can show it was the exercise of medical judgement, it belongs under state law and traditional regulatory authority." Texas Attorney General John Cornyn (R) expressed frustration at the ruling, saying, "The court left unanswered the very question we need resolved -- whether ERISA preempts the regulation of HMO medical directors who make medical decisions. When it comes to medical decisions made by HMOs in the state of Texas, it is the state's responsibility to oversee these decisions -- not the federal government's." The attorney general's office sought dismissal of UnitedHealthcare's suit, and will decide whether to appeal Judge Lynn's ruling (Shah, 9/13).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.