Health reform won't stop refusals to cover treatments, advocates warn

With health reform reaching the beachhead, painfully, and perhaps having a chance of passing at long last, nobody likes having to think about what didn't go right. But the truth is, not only is the current legislative fore-runner proposals imperfect, it leaves a barn-door-sized hole open in relationships between health plans and beneficiaries.

While health reform legislation may force insurers to issue policies to all, rather than screen for costly conditions, nothing in the current bills pending on Capitol Hill will give patients any significant new power to block denials of treatments. In fact, observers say, with insurers forced to take all comers and compete more strictly on price, they may be under new pressure to deny treatments as a means of keeping costs down.

While health plans may be more likely to deny coverage for care, patients still have no right to sue for damages over health benefit decisions as the law currently stands. For example, when a California couple sued Cigna when their daughter died after being refused coverage for a liver transplant, a federal judge threw the case out. That judge cited a 1987 Supreme Court decision involving the ERISA statute, which held that ERISA doesn't allow suits for such damages if the coverage comes from an employer.

At present, the healthcare bills pending in both houses of Congress leave this issue alone, and it doesn't seem likely such language will make it into this year's legislation. It remains to be seen whether the ERISA exception is seen as a hole to be plugged once the main body of reform is passed.

To learn more about this issue:
- read this Los Angeles Times piece [1]

Related Articles:
Reform won't stop health plans from avoiding the sick, analysts say [2]
Health plan rescissions under fire in reform talks [3]
CMS investigates Humana letter to beneficiaries on health reform [4]