Tennessee, North Carolina Legislatures Consider Expanding Right to Sue MCOs With Patients’ Rights Legislation

The following briefly summarizes recent debate over patients' rights legislation in Tennessee and North Carolina.

• Tennessee: The state House Judiciary Committee passed a bill on May 14 that would allow individuals to sue their health plans after exhausting internal and external review processes. Under the legislation, the review process also must be completed in three months, down from the current minimum of 18 months. The bill does not cover those enrolled in TennCare -- the state's Medicaid managed care program -- or state employees, and it is "unclear" if those with self-insured plans would be covered under the legislation. The Nashville Tennessean reports that about half of those with commercial insurance in the state would be protected by the bill. Critics of the measure say the bill does not cover many people, but state Rep. Kim McMillan (D), who sponsored the bill, said the legislation could also cover those in self-insured plans. The bill also requires the state comptroller to examine the legislation's impact on insurance premiums after one year. If increases are "minimal," state employees would be included in the provision. The bill now moves to the state House Budget Subcommittee; the state Senate Finance Committee is also scheduled to vote on the bill (de la Cruz, Nashville Tennessean, 5/15).
• North Carolina: The North Carolina Association of Health Plans is lobbying against patients' rights legislation (SB 199), saying it would increase costs to employers and require managed care plans to carry liability insurance (Vollmer, Raleigh/Durham Business Journal, 5/14). Under the legislation, patients would have the right to an internal and external review of any denied claims. In addition, health plans would be liable for any harm caused by treatment decisions made by the insurer's agents or employees (SB 199 text, 2/22). A study commissioned by the association found that the legislation would increase costs to companies by as much as $216 million annually, which would prompt some businesses to drop insurance coverage. Paul Mahoney, the association's executive director, added that doctors would order more tests and procedures to "protect themselves" from liability. However, Blue Cross and Blue Shield of North Carolina is supporting the bill, as it believes most disputes would be settled before reaching court. The measure has passed the state House and is being considered by the Senate. Gov. Mike Easley (D) is expected to sign the bill if it passes (Raleigh/Durham, Business Journal, 5/14).