In the first test of the state's new HMO appeals law, the Maryland Insurance Administration yesterday ordered Prudential HealthCare to pay for in-hospital rehabilitation for an 18-year-old honors student nearly paralyzed by a case of viral encephalitis.
Prudential did not appear at a hearing on the case yesterday, but later filed procedural objections that could lead to a court challenge.
The health maintenance organization had denied coverage, essentially arguing the patient could not be helped by hospital rehabilitation.
"Unfortunately, the patient's clinical condition precludes participation in and benefiting from acute hospital rehabilitation at this time," Prudential wrote after a review of the case.
Prudential was also fined $1,000 for violating the state insurance law. Both the state insurance agency's nurse-investigator and an independent medical review found that hospital care was needed for Aricka Williams of New Carrollton in Prince George's County.
Her mother, Holly Williams, was delighted with the insurance agency's order and with the speed with which the case was handled. The order came eight days after she filed her initial complaint with the insurance administration. Her daughter is covered by her health insurance.
"They want to go the cheapest route on everything," she said of the HMO. "Now, they know to think twice before they start messing with people."
State Insurance Commissioner Steven B. Larsen was pleased with the department's quick handling of the complaint. However, he was troubled by Prudential's procedural challenge.
"The [HMO] industry argued vigorously to have this bill passed and to have this process put in place," Larsen said. "And lo and behold, the first time we go through the process, we are met by a whole host of procedural and substantive objections."
Robert H. Kremer Jr., a Prudential spokesman, said, "Obviously, we are working closely with Aricka's physicians to provide the most appropriate care.
"We were notified yesterday by fax [Thursday] afternoon of a hearing [yesterday]. There wasn't enough time to get the people and information together for a hearing."
Prudential is hoping another hearing can be held next week, he said.
But Thomas P. Raimondi, associate deputy insurance commissioner, who was hearing officer at yesterday's session, said Prudential had been warned that if it did not appear at the hearing or request a delay in writing, an order would be issued.
"I think your client is playing games," Raimondi snapped over a speakerphone to Bryan B. Bolton, a lawyer representing Prudential. Raimondi phoned Bolton from the hearing room when no one from the HMO appeared.
In addition to the question of notice for a hearing, Bolton, in a letter delivered later in the day to the state agency, said federal law pre-empts the state's ability to take such action against HMOs.
Similar challenges to state "patient's rights" laws have been upheld by federal courts in cases from Texas and Arkansas.
Neither Bolton nor Kremer would comment on whether Prudential planned to pursue a court challenge to the state HMO appeals law.
The Maryland patient's rights law, passed last year, went into effect Jan. 1. Joy Hatchette, associate commissioner for complaints, said the insurance administration had received about half a dozen complaints under the new law, but all had been resolved without a hearing or an order being issued.
Aricka Williams, a first-year student on a full academic scholarship at Lincoln University in Pennsylvania, was studying to become a pediatrician.
A talented student, she took courses at local colleges while still in high school, her mother said.
On Oct. 26, she was hospitalized with encephalitis, an inflammation of the brain, and pneumonia. She can only turn her head and move her left arm.
On Dec. 28, she was transferred to the National Rehabilitation Hospital in Washington for physical therapy expected to last three to four months.
According to Larsen's order, her doctors warned that if she were to be moved out of the hospital, she would be "put at a higher risk of not gaining functional ability and risk of losing functional ability already gained."
Pub Date: 2/06/99