-Caveat Lector-

Judge Dismisses Racketeering Suit

By MICHAEL RUBINKAM
.c The Associated Press

PHILADELPHIA (AP) - A consumer group plans to appeal a judge's dismissal of
one of the first lawsuits in the nation to accuse a health maintenance
organization of racketeering.

The lawsuit said Aetna Inc. promised quality medical care, but encouraged
widespread cost-cutting and penalized doctors who didn't increase their
patient load. The lawsuit, filed in April on behalf of nearly 6 million Aetna
customers, claimed the abuses were so widespread they constituted a pattern
of fraud.

U.S. District Court Judge John P. Fullam this week agreed with Aetna, the
nation's largest health insurer, which admitted that its advertising claims
of being committed to ``maintaining and improving quality health care'' were
``mere puffery,'' but didn't amount to fraud.

Fullam on Wednesday rejected the plaintiffs' argument that ``in every case,
individual physicians ... will be moved to put their own economic interests
ahead of their patients' welfare.''

Even if that happened, the fault would be with the doctor, not the HMO, the
judge said.

The Foundation for Taxpayer and Consumer Rights, a California-based consumer
group representing the plaintiffs, called the decision a ``temporary
setback.''

``The fact that the nation's largest health care company admitted in this
litigation that its commitment to quality health care was 'mere puffery' is a
devastating admission that we intend to fully explore,'' foundation president
Harvey Rosenfield said Friday.

``It's going to have a tremendous impact on this company's reputation and
ability to service the marketplace.''

An Aetna spokeswoman did not return a call for comment Friday. The company's
U.S. Healthcare unit, based in Blue Bell, Pa., provides health insurance to
21 million Americans.

The Aetna case was one of the first to accuse an HMO of racketeering, a
charge originally aimed at organized crime. A similar lawsuit filed under
federal racketeering laws against U.S. Healthcare in 1988 also was dismissed.

A series of Supreme Court rulings over the past two years have permitted a
broader use of racketeering laws and allowed more lawsuits by people who
claim to have been harmed by a pattern of illegal activities.

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