At stake in a case before an appeals court is physicians’ right to bring a lawsuit against an insurer that fails to pay correctly for medically necessary services provided to a covered patient. Physicians are weighing in as the court considers whether a previous ruling that bars such action should stand.
In North Jersey Brain and Spine Center v. Aetna, a physician practice that received assignments of benefits from patients with employer-sponsored health plans sued the insurer for denying and underpaying medically necessary surgeries for three different patients. The claims were brought to court only after the practice exhausted internal appeals processes with the insurer.
The district court in which the case originally was heard ruled that physicians must have more than the standard assignment of benefits to give them grounds for a lawsuit. The decision goes against decades of previous court rulings, accepted practice and the intention of the Employee Retirement Income Security Act (ERISA). The case now is being heard by a U.S. court of appeals in Philadelphia.
“Physicians are willing to provide medical care without demanding … up-front payments because they are confident that, if necessary, they can pursue remedies under ERISA for improperly denied insurance benefits,” the Litigation Center of the AMA and State Medical Societies and the Medical Society of New Jersey said in a friend-of-the-court brief filed last week.
“The district court’s holding … that patient assignments only transfer ERISA rights if they explicitly include some unspecified magic language is completely inconsistent with settled federal common law, the purpose of ERISA and the reasonable expectations of physicians and patients,” the brief said. “If the district court’s decision is affirmed, it will harm physicians and patients alike.”
Supporting physicians’ ability to deal directly with insurance companies when there is an issue with how a claim has been paid not only saves the patient who may be ill from dealing with overwhelming administrative processes but also prevents financial constraints from interfering in the patient-physician relationship.