Woman's Appendix Ruptures Supreme Court!

A woman from Bloomington, IL, whose appendix ruptured in 1992 when an HMO physician failed to diagnose acute appendicitis in a timely fashion, is attempting to sue the HMO in federal court for creating the financial incentives that allegedly caused  the physician to botch the diagnosis. She took her case to the Supreme Court on February 23

Cynthia Herdrich says that when she showed up in the emergency room doubled over with abdominal pain, the doctor responded by scheduling an ultrasound 8 days later at a facility 50 miles away.  While waiting for this test, Ms. Herdrich's appendix ruptured and she nearly died.

Ms. Herdrich has successfully sued the doctor for malpractice, and is now going after the HMO. By offering its physicians financial bonuses for saving money, she alleges, the Carle Clinic HMO incented her doctor to act inappropriately.  The HMO thus violated its duty to her under ERISA, justifying her suit in federal court.

The HMO has responded by asserting that patients should not be allowed to block such financial incentives, which are the modus operendi of all HMOs. The Justice Department has also opposed Ms. Herdrich's suit in federal court, denying that the HMO had a fiduciary duty to its beneficiaries under federal law.

During oral arguments, the Justices did not appear sympathetic to Ms. Herdrich's case. Justice David Souter allowed as how the interest of HMOs is to hold down costs, and to do otherwise would put them out of business.  Justice Sandra Day O'Connor expressed her reluctance to engage the Supreme Court in determining which financial incentives go too far. Financial incentives, she asserted, were what Congress wanted when it passed HMO legislation. Justices Breyer and Rehnquist also expressed skepticism with Ms. Herdrich's arguments.

The Health Insurance Association of America promises that if Ms. Herdrich wins her case, the result will be acceleration of health care inflation, higher premiums, and loss of control over health care spending.

DrRich comments:

This is not the best case that could have been brought in the attempt to establish a patient's right to sue an HMO.  It's hard to argue that incompetence of the degree displayed by the doctor in this case (at least according to the facts as reported) is due solely to financial incentives. (Why, when I was in medical school, we routinely diagnosed acute appendicitis without newfangled tests like ultrasound scans -  and we did it after walking 5 miles through the snow.)  Any doctor who would ask a patient who even might have acute appendicitis to wait 8 days before making a diagnosis is plagued by far more than financial incentives.  One suspects this doctor would have blown it even if he (or she) worked for Mother Theresa instead of for the Carle Clinic.  The appropriate remedy in this case, it seems to me, is in the malpractice court.  Ms. Herdrich already took that route, and won.

Indeed, it appears that Ms. Herdrich will have to be satisfied with the $35,000 she was awarded in her malpractice case.  By their reported remarks and questions, the Supreme Court Justices appear quite skeptical about the merits of her arguments. 

Their reported comments also show that the Justices clearly understand the bargain our society has made with HMOs (through its duly elected officials,) namely, that some people will be hurt by the effort to hold down medical costs. That's just the price we pay. Seek your remedies where you can, injured one, but don't ask us to change the system that society has chosen.

In fact, the Justices' remarks are as close as public officials ever come to openly admitting the fundamental truth about the American health care system; to wit: that we're covertly rationing health care, and to do so we must separate the interests of the doctor from the interests of the patient.  Quite simply, this is because the doctor-patient encounter is the basic unit of all health care spending.  Therefore, to curtail spending, we've got to make doctors worry about something other than what's best for the patient.  Financial incentives is one way to do that.  The threat of a federal fraud rap for violating undecipherable regulations is another.  Either way, as the Justices pointed out, this is the system we've chosen.  

Given the realities, and especially given the Supreme Court's surprising lack of reticence about pointing out the realities, a verdict against Ms. Herdrich is entirely predictable. 

2/24/2000

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