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LITTLE ROCK, Ark.-Arkansas' Patient Protection Act, which requires health plans to accept any health care providers willing to meet a plan's terms and conditions, is pre-empted by the Employee Retirement Income Security Act, the U.S. District Court for the Eastern District of Arkansas ruled.
In his Jan. 31 opinion, Judge James M. Moody permanently enjoined the act's enforcement, ruling the state's any-willing-provider provision, known as the Patient Protection Act, "has a direct impact on the structure, content and administration of health benefit plans which triggers the pre-emptive provisions of ERISA." ERISA pre-empts state laws that "relate" to employee benefit plans. He did rule, however, there was insufficient evidence "of a direct or acute indirect economic impact." Over the past few years, managed care organizations in several states have opposed any-willing-provider statutes, arguing that such laws jeopardize their ability to ensure quality and control costs.
In 1995, the Arkansas Legislature passed the Patient Protection Act with the intent to give patients the right to choose the health care provider of their choice.
Prudential Health Care Plan Inc., HMO Partners Inc., Arkansas AFL-CIO, Tyson Foods Inc. and the United Paperworkers International Union challenged the Act, claiming it essentially changes the terms and conditions of benefit plans by nullifying limited panel networks and eliminating gatekeeper functions.
In a release, Norine Yukon, executive director of Prudential Insurance Co. of America's health care plan in Arkansas, said she is pleased with the ruling. "The ruling benefits employers because it safeguards their ability to offer high-quality, less expensive health care benefit plans to their employees."
On the other hand, David Wroten, executive vp for the Arkansas Medical Society, which helped draft the Patient Protection Act, said in a release: "The people of Arkansas are the real losers. With an overwhelming voice through testimony, letters and phone calls to legislators, the people of Arkansas said they wanted freedom to choose their health care providers. Yet the insurance industry has used a federal law known as ERISA to hijack the will of the people even though ERISA was originally intended to protect patients, not insurance companies."
Mr. Wroten said the case is being appealed.