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State Rules on HMO Prescriptions

October 31, 1998

BOSTON (AP) _ The state can’t require health maintenance organizations to provide unlimited prescription drug benefits to seniors, a federal judge ruled Friday.

Massachusetts was the only state that required HMOs to provide unlimited drug coverage to seniors, so the ruling brings the state in line with the rest of the country.

Harvard Pilgrim Health Care said last summer it would limit prescription drug benefits to $800 a year for seniors. Tufts Health Plan followed suit, saying it would limit coverage to $500 a year.

Insurance Commissioner Linda Ruthardt sued, saying the decision violated a 1994 state law prohibiting HMOs from limiting prescription benefits to the elderly.

The Massachusetts Association of HMOs, which represents 15 HMOs in the state, countersued, arguing that a 1997 federal law says HMOs can limit the benefits and asking that Ruthardt be prevented from enforcing the law.

U.S. District Judge Richard Stearns agreed with the insurers and blocked enforcement of the 1994 law.

Clare McGorrian, a lawyer with Health Care for All, a consumer advocacy group, called on the division of insurance to appeal.

``The HMOs’ selfish and shortsighted actions will ... have a catastrophic effect on the health of many seniors and disabled people who cannot afford Medigap coverage,″ she said.

State officials said they were disappointed by the decision, but had not yet decided whether to appeal.

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