Cases and Comments on Contracts

Courts Hold HMOs Liable for Patient Care Decisions and Physician Due Process

by Robert V. West, MD JD FAAEM

Texas law requires HMOs to exercise ordinary care in making health care decisions as regards the treatment options provided to their insured/or patients. Similarly, the same law protects physicians from HMO retaliation for advocating medically necessary care for their insured/our patients. (Tex. Civ. Prac. and Rem. Code, Section 88.0001 et seq.)

In a recent Texas case, a Corpus Christi, Texas jury awarded $19 million in actual and punitive damages to a primary care physician who sued Humana Health Care Plan physicians Network. The jury awarded Dr. John Paul Schultze $1.9 million in actual damages for lost profits to his business and medical credentials plus $3 million for metal anguish on November 16, 2000. It then assessed $15 million in punitive damages the next day. (Schultze v. Humana, Tex. Nueces County Ct., No. 97-04373-G, 11/16/00)