AUSTIN, Texas -- An investigation into the operations of Texas health maintenance organizations isn't drawing much support from employers.

HMOs are being asked by Texas Attorney General Dan Morales for information that will aid his office in determining whether the plans are running afoul of laws that regulate HMOs.

The investigation is "more HMO bashing, basically," said Marianne Fazen, executive director of the Dallas/Fort Worth Business Group on Health.

Larry Hall, executive director of the Houston Area Health Care Coalition, said: "We have pushed and pushed for a marketplace in health care. In my opinion, that's what we have. Let it work itself out without this interference."

Knowledgeable benefit managers "know exactly what they are buying," he emphasized, and they listen to employees who let them know how HMOs are performing.

"If employees come around loud enough, there will be solutions" to any problems they point out related to HMOs, Mr. Hall said.

The attorney general's office is saying little about its investigation. "We've asked for information from certain HMOs," a spokesman for the attorney general said. "We're not disclosing who they are or the nature of the investigation except to say it is in regard to how HMOs provide health care or affect the health care of citizens in Texas."

The spokesman for the attorney general said he has "no idea" how long the investigation might take.

It is unclear how many HMOs are being investigated, but two confirmed they have been asked by the attorney general to provide information.

PacifiCare of Texas is meeting with the attorney general's office to provide the requested information, a spokeswoman for Santa Ana, Calif.-based PacifiCare Health Systems Inc. said. The Texas plan has 197,000 members. Officials at the plan are unsure how the information will be used, she said.

The spokeswoman said it is unclear whether the attorney general is investigating all HMOs or targeting ones about which members have complained.

"We think that overall we are in compliance with federal and state regulations," she noted.

Prudential HealthCare, a unit of Prudential Insurance Co. of America in Newark, N.J., with about 1 million members in Texas, also has been contacted and is working on providing information sought by the attorney general, a spokeswoman confirmed.

Separately, Harris Methodist Health Plan, an Arlington, Texas-based HMO, is working on an agreement with the Texas Department of Insurance that could result in the plan reimbursing millions of dollars in fines to Texas doctors. The physicians were penalized for exceeding prescription cost limits set by the plan.

While it is unclear exactly what information the attorney general is seeking, issues such as denial of care or arrangements like the Harris Methodist limits on prescriptions are not ones employers are vocal about, Ms. Fazen said.

"My impression is that employers are not complaining about that, nor are their employees," she said. "If there were all the problems that are touted in the press -- like denial of care -- HMOs wouldn't be in business."

George Crowling, regional health care manager at GTE Corp. in Irving, Texas, said, "I don't think I have ever seen a denial of care on an HMO's part that I thought was not warranted."

"If there is anything systematic that HMOs are doing" in terms of denying care or using illegal financial incentives to force physicians to keep costs down, he said, he is unaware of it.

Ms. Fazen and Mr. Hall point out that employers handle quality-of-care issues directly with managed care plans if those concerns arise. They say employers are in touch with employees who let them know when such issues need to be addressed.

Ms. Fazen said employers are more concerned about issues such as government intrusion into benefit design and efforts to erode the Employee Retirement Income Security Act.

Marcia MacLeod, manager of benefits development at Electronic Data Systems Corp. in Plano, Texas, said, "It seems pretty popular to beat up on managed care these days."

"We work real closely with all our HMOs," she said, and when concerns arise, "we talk directly with them."

EDS solicits employee feedback to make sure quality of care is adequate, Ms. MacLeod said, and employees have indicated they are satisfied with the plans' service.

Texas last year passed legislation allowing HMO participants to sue their plans for malpractice (BI, May 19, 1997).

Meanwhile, Harris Methodist is close to finalizing an agreement with the Texas Department of Insurance that will determine how much the health plan will reimburse physicians it penalized for exceeding limits on prescriptions.

Neither the plan nor the Insurance Department would release details of the agreement, but a spokeswoman for Harris Methodist confirmed that reimbursements could run as high as $4 million.

She also said negotiations are continuing on whether the plan should pay an $800,000 penalty to the state that Insurance Commissioner Elton Bomer is considering. The fine would be in addition to the physician reimbursements.

The plan is facing lawsuits filed in state court by physicians and patients regarding its policies on prescriptions.