Following the activist example of many doctors across the nation, physicians in Hawaii sued the state's largest insurer, alleging unfair and anticompetitive reimbursement practices. The 900-member Hawaii Medical Association and two of its member doctors charge that Hawaii Medical Service Association, a Blue Cross and Blue Shield plan that insures about two-thirds of the state's population, routinely reduces or denies claims from physicians. Hawaii's medical association is the fourth state society in the past four months to file a lawsuit accusing big health plans of unfair and illegal business practices, joining New Jersey, South Carolina and Tennessee. At least seven other statewide physician groups are involved in the litigation.
The Hawaii group's complaint, filed in state court in Honolulu, claims that the actions by HMSA have cost physicians millions of dollars in the last six years. HMSA officials said the procedures used to process claims and reimburse physicians are appropriate. The company, which has 630,000 members, has lost money in each of the last three years, they said. In March 2001, medical associations in California, Texas and Georgia filed a class-action lawsuit against several large insurers. Cliff Cisco, senior vice president of HMSA, said the state's insurance commission found no evidence of wrongdoing when similar allegations were made about three years ago by physicians in Hawaii. "We intend to vigorously defend ourselves," he said. "We're confident that when we go to court on this one, they won't be able to prove these allegations." The lawsuit, which was later joined by Florida, is being heard in federal court in Miami. -- by Michael Romano