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Supreme Court Narrows Patients' Rights to Sue HMOs, Lowers Bar for Proving Job Discrimination

Aired June 12, 2000 - 2:01 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

NATALIE ALLEN, CNN ANCHOR: If you are thinking about suing your HMO, the nation's highest court has made it harder for you today. At the same time, the court has lessened the burden on people suing for job discrimination.

Senior Washington correspondent Charles Bierbauer joins us from the court to explain these rulings -- Charles.

CHARLES BIERBAUER, CNN SENIOR WASHINGTON CORRESPONDENT: Natalie, harder, but not impossible. The case before the court posed the question of whether a physician employed by an HMO had a fiscal interest that might have exceeded her patients' interest, and the court ruled unanimously that cost consciousness is part of what HMOs are about, hence no conflict of interest for this particular physician in a case that came to the court from the state of Illinois.

(BEGIN VIDEOTAPE)

BIERBAUER (voice-over): A physician's oath pledges to do no harm to patients, but then there's the bottom line, increasingly a factor in managed care.

UNIDENTIFIED MALE: What matters is whether financial incentives put so much pressure on physicians that physicians can no longer act primarily on behalf of patients.

BIERBAUER: That possible conflict of interest played out painfully for Cynthia Herdrick (ph), who was covered by her husband's health care at the Carle Clinic in Bloomington, Illinois. Herdrick complained of abdominal pains. Her doctor ordered an ultrasound diagnosis to take place eight days later, according to clinic policy. Too late: Herdrick's appendix ruptured. She was rushed to emergency surgery, but at Carle's hospital 50 miles away in Urbana. Herdrick sued and won a $35,000 malpractice verdict in state court.

UNIDENTIFIED MALE: That case had already been settled. Now, the case has kind of been twisted into this really very bizarre theory against incentives that are in place, against the way that health plans pay.

UNIDENTIFIED MALE: The docs are gatekeepers with respect to access to more costly treatment and they're also clinical caretakers. That's what's new here. (END VIDEOTAPE)

BIERBAUER: Well, in the wake of this opinion, the health insurers are optimistic and positive about this result. Across the street on Capitol Hill, Democratic leader Senator Tom Daschle said Congress will have to do more to protect patients. Indeed, the Supreme Court said if that's what Congress' intent were, Congress would have to lay that out specifically.

Justice Souter, writing for the majority, said that there is always another place to sue, and that's in state courts under malpractice laws, which is exactly what Cynthia Herdrick did and won there. But she did not win this federal case.

On another matter, the court did make it easier for employees to sue their employers, specifically under age discrimination laws in a case that comes from Mississippi, where, after working some 40 years on the job for a plumbing parts manufacturer, Roger Reeves was fired. He says it was age discrimination -- a new supervisor who said things like, you're just too old for this job. The company said that Reeves wasn't able to do the job, that there were foul-ups in paperwork. But the Supreme Court ruled unanimously that Mr. Reeves had at least presented ample evidence on its face for the jury to have concluded that age was a factor in his firing. This could have implications not just for age discrimination suits, but for others suits as well, giving juries a good bit more latitude -- Natalie.

ALLEN: Charles Bierbauer at the Supreme Court.

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