Recent federal court decisions and regulations threaten the ability of states to regulate health plans, Steven B. Larsen, Maryland's insurance commissioner, said yesterday.
Supported by legislators and by trade groups representing doctors, hospitals and insurance agents, Larsen said the trend jeopardizes Maryland's right to pass and enforce laws giving patients the right to appeal denials of care and requiring insurers to cover emergency room visits, clinical trials and 90-day supplies of maintenance drugs.
"The ability of states to regulate health insurance is being severely undermined," Larsen said at a news conference in Baltimore.
The insurance commissioner dramatized his case by presenting 8-year-old Amber Stewart of Port Deposit, who has a form of muscular dystrophy. Her mother, Alice Stewart, said their insurer initially refused to pay for a nurse to accompany Amber at school, but relented after intervention by state insurance regulators.
Until recently, federal law had been interpreted to mean that states could regulate health insurance, except for plans in which an employer is self-insured. The self-insured plans, covering an estimated 25 percent to 30 percent of insured Marylanders, are not subject to state laws and regulations.
Over the past year, Larsen said, three rulings in federal courts, including one in a Maryland case, have further limited state authority, even over insured health plans.
The Maryland case involved an effort by the Maryland Insurance Administration to make sure that self-insured plans were truly self-insured, and not attempts to circumvent state regulation. In a decision the Supreme Court let stand, a federal circuit court said Larsen's department did not have the authority to limit such plans. Other cases struck down patients' rights bills in Texas and Arkansas.
Also, Larsen continued, new Department of Labor regulations cover insured health plans as well as self-insured ones, creating more ambiguity as to what authority states have.
State Sens. Thomas L. Bromwell and Paula C. Hollinger, Baltimore County Democrats, said they would introduce a resolution in which the state would ask Congress to make sure states could continue to regulate health plans.
"I don't want constituents to have to go to federal court or to Congress" if they have a dispute with a health plan, Hollinger said.
Larsen said he does not have specific corrective legislation in mind, but he is working with the National Association of Insurance Commissioners to develop recommendations. He said the NAIC is also working to stimulate interest in the issue in other states.
Larsen said his department handles about 800 complaints a month from consumers about their health plans.
One of those complaints last year was from the Stewart family. Alice Stewart, Amber's mother, said their health plan, Aetna U.S. Healthcare, supplied a home nurse for Amber. However, she continued, when Amber started school, the health plan said she was no longer homebound, so she no longer needed nursing service.
The insurance administration determined that the nurse should be covered by her policy, Stewart said. Now, a nurse accompanies Amber all day in school.
Pub Date: 2/02/99