Attorneys for physicians in managed-care plans believe a recent California appeals court decision will allow courts to intervene when doctors challenge HMOs' policies on fees and physician membership.
But because the health plan in the case is satisfied with the appellate decision, "a lot of people are scratching their heads and wondering what the next step is going to be," said Lowell Brown, a partner in the healthcare practice at Weissburg & Aronson in Los Angeles.
The case stems from a 1990 fee dispute between two dentists in Delta Dental Plan of California's 21,900-provider network. Delta tried to lower the fees it paid the dentists to the level of fees the dentists were receiving from a competing plan.
The dentists protested, and the matter was referred to an internal committee of Delta, which ruled in the plan's favor. Under Delta's bylaws, the committee's decisions are final and binding.
When the dentists sought external arbitration, Delta filed suit.
A trial court agreed that the matter wasn't subject to arbitration. The dentists appealed, and in September the appeals court dismissed their claim to arbitration.
But at the same time, the court said that if physicians aren't satisfied with the internal appeals procedures provided by managed-care plans, they could ask a court to review those procedures.
Individuals have a right to be protected from arbitrary exclusion or expulsion from private organizations that control important economic interests, said Judge P.J. Klein.
Attorneys said the decision is the first to grant physicians in managed-care plans a right to fair procedure and the first to use economic criteria to reach a decision in the context of managed care.
Delta attorneys are satisfied with the decision. "The court said the dentists can't seek arbitration but can go back to the internal procedure, and if they don't like it they can seek (review by the court)," said Robert Becker, Delta's general counsel. The dentists involved haven't begun that process, he said.