Recent lawsuits against HMOs are challenging decisions based on corporate policies. In Detroit, Michigan, Blue Care Network settled a lawsuit based on negligent corporate policies. According to the lawsuit, 12-year-old Kimmietta Branch suffered permanent brain damage after being denied medical treatment by a Blue Care Network pediatrician because of an outstanding $40 bill. She died four years later. Although Kimmietta Branch’s mother, Cassandra Branch, offered to pay the bill, she was told she could not pay and could not see a physician. Two days later the child became disoriented and was admitted to a hospital, where she was diagnosed with viral encephalitis. According to the lawsuit, Blue Care Network had a bad-debt policy that prohibited patients from seeing a physician if there was an outstanding bill.

In another case, the parents of a two-day-old girl who died a day after she went home in 1995 are suing Aetna U.S. Healthcare, Blue Bell, Pennsylvania, for damages caused by the insurer’s former policy of discharging newborns from hospitals after 24 hours. The, previous testimony of the parents, Steve and Michelle Bauman, to Congress and the New Jersey legislature led to a Federal law and many state laws requiring a minimum 48-hour stay for newborns and their mothers. The U.S. Supreme Court set a precedent in June 2000 when it upheld a Federal appeals court ruling that the couple could sue the HMO for malpractice in state court. A lawsuit has been filed, and the trial is expected to take place next summer.

Previously, state malpractice lawsuits against HMOs were moved to Federal courts, where plaintiffs could recover only the cost of care denied them. Now HMOs face pending Federal class-action lawsuits challenging how HMOs manage care and potential Federal and state laws giving patients the right to sue their HMOs.