Vol. 5, No. 2

May, 1997

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by Timothy A. Shollenberger, Esq.

We represent many people who are covered by many different types of medical insurance plans. One of the insurance plans that an increasing number of our clients are insured under are administered by Health Maintenance Organizations, or HMO's. The premise of an HMO is that there is a network of physicians that is selected by the Health Maintenance Organization in a particular geographic area. Each insured is assigned to a "primary care physician." Only with the blessing of the primary care physician can referrals be made to specialists. But, what happens if the physician chosen by the HMO for the insured provides substandard care? Is the HMO liable? It seems reasonable that it should be, particularly where the insured had no choice than to go to the physician selected by the HMO. In response, the HMO's have argued that only the physician providing the care can be held accountable. They argue that they did not provide or direct the care and that the physician is not their agent but more akin to an independent contractor, not subject to their direction or control. The Pennsylvania Legislature is now considering legislation that would hold HMO's accountable for the harm caused by those providing care under its plan. It makes sense to hold HMO's accountable because they strictly control the physicians who treat their insureds. Too often, they, not the physician, control important aspects of the patient's care, including who they can see. For example, many HMO's may not pay for care provided by physicians who are not approved by them and will not pay for care provided by specialists unless the referral is pre-approved by the primary care physician. Thus, legislative action to hold HMO's accountable is an idea that we support. If you agree, we would encourage you to contact your legislator and make your feelings known. If you have any questions or wish to know more about this very important issue, please do not hesitate to call.