Can an insurance company physician who refuses to pre-certify an operation be disciplined for medical incompetence and a lack of professionalism?
That question is the focus of a legal dispute being waged in Arizona. A ruling against the disciplined physician could have profound implications for insurers and managed-care organizations and undermine the practice of utilization review.
A complaint filed by Blue Cross and Blue Shield of Arizona in state court in Phoenix last month seeks to dismiss a "letter of concern" issued against the Blues plan's medical director, John F. Murphy, M.D., by the state Board of Medical Examiners in July. The board issued the letter-a black mark on Dr. Murphy's record-after he refused to pre-certify a surgeon's request to perform a gallbladder operation in December 1992.
At issue is whether a state medical board has direct authority over the medical director of an insurance company if that person is a board-licensed physician.
According to the complaint, the dispute began in December 1992 when an Arizona surgeon submitted a pre-certification request to perform gallbladder surgery, deeming it medically necessary.
After concluding the surgery wasn't an emergency, Dr. Murphy denied pre-certification but recommended that the physician contact an independent specialist for further review at the Blues' expense.
The surgeon subsequently performed the operation-without seeking an independent consultation-and later filed a complaint with the board, accusing Dr. Murphy of unprofessional conduct and medical incompetence.
The board followed up the complaint with its own investigation, eventually issuing the letter of concern in July.
The Blues plan and Dr. Murphy filed their own complaint in state court last month, arguing that the board went beyond its jurisdiction by disciplining Dr. Murphy. It also claims that the Arizona Department of Insurance dismissed a similar complaint against Dr. Murphy filed by the patient who was denied coverage for the surgery.
Neither Blues officials nor representatives from the state medical board could be reached for comment.