In a potential watershed case for the health insurance industry, a Nevada jury awarded $24 million in compensatory damages and $500 million in punitive damages to three plaintiffs in a case stemming from a hepatitis C outbreak.
In the case against affiliates of UnitedHealth Group, two plaintiffs claimed they became infected when their gastroenterologist used unsafe injection practices for an endoscopy; one plaintiff was a spouse. In medical malpractice cases, plaintiffs can generally only recover damages from the doctor and the hospital. But in the Nevada lawsuit, the plaintiffs argued that UnitedHealth Group should be held responsible because the doctor was part of the company’s network and the insurer should have had better oversight.
If the case is upheld on appeal and other states follow Nevada’s lead, insurers would have to make significant changes to their oversight of network providers. This verdict, which extends direct responsibility for a doctor’s medical malpractice to health insurers, will increase costs for consumers without improving safety. It’s yet another threat to the affordability of healthcare.
Just what we didn’t need from the courts—more costs piled on a bloated healthcare system. With the pressure of escalating costs, a national system could loom as a viable solution.
I fear we are headed for a government takeover. For the proponents, be careful what you wish for.