Anger among doctors toward health insurers is boiling over across the nation-and into the courts.
In the past month alone, the medical societies of New Jersey, South Carolina and Tennessee have filed lawsuits accusing some of the nation's largest health plans of engaging in a wide array of unfair and illegal business practices. These actions come on the heels of lawsuits filed against HMOs by at least seven other statewide physician associations over the past two years (See chart).
More and more, state medical societies are being compelled to take up the cause of individual doctors who, on their own, are finding themselves powerless against massive insurance companies, said Richard Corlin, M.D., president of the American Medical Association, which supports the lawsuits.
"Physicians feel they are backed into a corner with no remedy except the courts," said Corlin, a California gastroenterologist. "There is power in numbers. It sends the message that these problems are not isolated but pervasive."
The lawsuits, he said, have the potential to revamp how managed-care companies operate and how healthcare services are delivered.
Insurers, however, contend they are being ambushed by hastily filed legal actions that will divert healthcare dollars away from medical care and ultimately drive up premiums.
Aetna, for one, argues that it has taken significant steps over the past few years to address many of its providers' concerns. Representatives for the Hartford, Conn.-based insurer, for instance, have been meeting regularly with the Medical Society of New Jersey over the past two years to work out their differences. But now, the organization's lawsuit will likely derail those negotiations, the insurer says.
"This lawsuit and others like it do not advance any constructive goal," said a written statement by Aetna, which is named as a defendant in suits by at least five state medical associations. "We continue to believe that the best interests of millions of patients-in New Jersey and across the nation-are served not by litigation, but by parties engaging in meaningful dialogue."
Physician associations, however, argue that the lawsuits were a last resort after their repeated complaints continued to fall on deaf ears.
"We tried legislation and negotiation, to no avail," said J. Capers Hiott, M.D., president of the 6,000-physician South Carolina Medical Association, which in late April filed a lawsuit in state court in Richland County against Cigna Corp. "It has now become necessary to level the playing field through litigation."
Robert Rigolosi, M.D., president of the Medical Society of New Jersey, echoed Hiott's complaint. "These abuses have been going on for years now," he said. "In our frustration, we felt that we just couldn't deal with the problem any longer."
Like its Tennessee counterpart, the New Jersey group filed lawsuits accusing various insurers of, among other things, using computer software to automatically deny claims and of downcoding claims to make it look as if doctors performed simpler, less-costly procedures. The organizations also allege that health plans have forced physicians into one-sided "take-it-or-leave-it" contracts that infringe on the doctor-patient relationship and threaten the continuity of care.
The accusations rankle insurers, many of which contend that the medical societies are simply wrapping their economic interests in the sheep's clothing of patient protection.
Paul Macielak, president of the New York Health Plan Association, called the lawsuits copycat actions aimed at enriching doctors' pocketbooks. "If doctors are truly concerned about patient care, they would use their considerable resources on efforts to improve overall quality of care and reduce medical errors," he said.
Insurers point out that almost all of the lawsuits are being brought by one of two national law firms that have been aggressively seeking to represent medical associations: the Birmingham, Ala.-based law firm of Archie Lamb and San Diego-based Milberg Weiss Bershad Hynes & Lerach, which made millions wrenching huge settlements from the tobacco industry. Archie Lamb is representing the medical societies of California, Florida, Georgia and Texas in a consolidated federal lawsuit against HMOs now being heard in Miami.
Many of the medical associations suing HMOs aren't seeking monetary damages. Rather, their lawsuits essentially ask a judge to order the insurers to stop engaging in the acts in question.
Corlin and others predict that more physician associations will take to the courts. The Colorado Medical Society, for one, confirmed that it's considering filing a lawsuit against some of the health insurers in its state.