A court decision this week in a Texas case could jeopardize Maryland's law allowing patients to get an independent review of HMO decisions not to provide care, Steven B. Larsen, Maryland insurance commissioner, said yesterday.
The U.S. Court of Appeals for the 5th Circuit in New Orleans upheld the part of Texas' HMO regulatory law that allows patients to sue HMOs for medical malpractice. At the same time, the court said federal law prevents states from requiring HMOs to submit their decisions to an independent review process.
Maryland is one of more than 30 states with some form of independent review law.
Although the decision applies only in the states covered by the 5th Circuit - Texas, Louisiana and Mississippi - Larsen said he is concerned that the same reasoning might be applied by other courts.
"It's really a nightmare come true," he said.
He said federal legislation was needed to clarify states' authority.
The Texas challenge had been brought by units of Aetna U.S. Healthcare, the country's largest health insurer. Jill Griffiths, an Aetna spokeswoman, said yesterday that the insurer will comply voluntarily with the Texas review process and abide by its decisions.
However, she said, "We absolutely agree" with the court's ruling Tuesday that states cannot require such reviews.
Maryland's review process, which began last year, allows Larsen to refer a case to independent medical experts when an HMO says a service is not medically necessary. In the first year of the process, regulators upheld the HMO decision to deny service 45 times, and ordered the HMO to provide service 46 times.
More than 200 other cases were resolved during the review process.
Aetna has filed an administrative appeal to one of the Maryland cases, Larsen said. In that case, Larsen ordered inpatient treatment for substance abuse for a juvenile.
The patient is receiving the treatment, according to the insurance administration, but Aetna has not agreed to pay for it.
In its appeal, Larsen said, Aetna claims that federal law pre-empts the state from ordering that it provide the treatment.