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Treatment Denials, Health Costs
Patients and their doctors should have the final say in what constitutes medical necessity, says Texas Attorney General John Cornyn. He's asked the federal 5th Circuit Court of Appeals to reconsider a ruling that struck down a 1997 state law establishing an appeals process for HMO patients who are denied treatment.
In June 2000, the court bought the insurers' argument that federal laws preempt the state's independent review process. Since that ruling, however, the US Supreme Court has rejected similar arguments in an Illinois case. Cornyn wants the appellate court to review the Texas case in light of the high court's recent decision.
The nation's health insurers reported a 25-percent increase in profits for last year, according to research conducted by Weiss Ratings, an independent rating firm based in Palm Beach Gardens, FL. In the aggregate, the industry earned $4.1 billion in 2001, up from $3.3 billion the previous year. Blue Cross and Blue Shield Plans reaped most of the industry's net earnings (70 percent).
Profits at the nation's 573 HMOs, on the other hand, fell nearly 7 percentfrom $1.08 billion in 2000 to $1.01 billion last year. Though the decline isn't a "great concern," says Weiss VP Melissa Gannon, it "may be a sign that increasing medical costs are beginning to outpace the rate increases of the past few years."
Yvonne Wollenberg. ONLINE News Briefs.