A managed-care plan's attempt to move some of its primary-care physicians into capitated contracts is being challenged in federal court.
The suit is an example of the friction being generated between insurers and physicians as managed care takes hold across the country.
The seven-page complaint, filed Dec. 19, 1995, alleges that Aetna Health Plans of New York breached its "fiduciary duty" to beneficiaries by threatening to terminate participating physicians' contracts unless the doctors agreed to switch to monthly capitation payments from a fee-based schedule. The complaint was filed in U.S. District Court in Brooklyn by Mara Maltz, the mother of adolescents with Crohn's disease.
The suit contends that Aetna violated a section of the Employee Retirement Income Security Act, better known as ERISA, that protects the interests of benefit plan participants. It says by "threatening" physicians with contract termination, Aetna has disrupted the doctor-patient relationships of Maltz's children.
Maltz, a North Bellmore, N.Y., resident, has been informed by her children's physicians that they cannot provide services under the new capitation plan. The suit maintains that those monthly payments, ranging from $4.86 to $6.45 for patients age 12 to 20, are inadequate.
Angelo Dascoli, the plan's vice president for marketing, said the suit is baseless and represents "another attempt to use the courts to attack managed healthcare."
Beginning in November, Aetna began moving some of its primary-care physicians into capitated contracts for some of its insurance products, Dascoli said. The conversion to capitation from a fee schedule, which may take six months to complete, will affect 1,358 of the plan's 2,707 primary-care physicians, he said.
Aetna requires primary-care physicians to participate in all its products, so those who decline to accept capitation for the plan's HMO and point-of-service products will be dropped from all Aetna's products, he said.
The suit seeks an injunction prohibiting Aetna from forcing physicians to accept capitation payments and barring the plan from interfering with provider contracts. The League of Physicians & Surgeons, a New York-based organization that bills itself as a "doctor-patient advocacy group," is guaranteeing payment of any costs incurred in bringing the suit. The league's attorney, Whitney Seymour Jr., a partner with the New York-based firm of Brown & Seymour, is representing the plaintiff.
The 1,000-member physician group has several members who risk being dropped by Aetna if they don't agree to accept capitation. "It's either make the switch or leave the plan," Seymour said.
Under capitation, "the financial incentive is to skimp on care," charged Yvonne Archer, the league's executive director. She said that such agreements "tie the hands of doctors." Seymour and the league also are involved in two earlier challenges of Aetna's contracting practices (Oct. 2, 1995, p. 54; Aug. 28, 1995, p. 22).