High-Profile Suit Over Treatment by PacifiCare Doctor Is Settled

On the eve of trial, the family of a Costa Mesa man has agreed to settle a case accusing a health maintenance organization and a doctor of not recommending a lung transplant because it would have cost them too much.

George McCall was 58 when he died in 1999, three hours after having the transplant. The family contended he would have had a better chance of survival had surgery been done earlier, when he was in better health.

“I just hope the next time a doctor sees someone who needs treatment that perhaps he’ll look at his heart and not at his pocketbook,” said his widow, Barbara McCall, whose suit was being closely monitored by the health-care industry.

The settlement reached in the case was confidential, a condition insisted upon by the defendants, Carol Jimenez, an attorney for the McCall family, said Thursday.

A jury was chosen last week, and opening arguments were scheduled to start Tuesday in Santa Ana Superior Court. The settlement was reached Monday night.

Spokesmen and attorneys for the defendants, PacifiCare of California, Dr. Lakshmi Shukla and Greater Newport Physicians Inc., declined to comment.

The case highlighted the conflicts doctors face in deciding whether to use an expensive treatment on an HMO patient when much of the cost would come out of their pocket.

Even before going to trial, the McCall suit had caused problems for the managed care industry. The state Supreme Court ruled in the case that Medicare patients may sue HMOs when they are denied treatment Medicare will not pay for. Before the ruling, those complaints were heard in an administrative proceeding.

McCall, who owned a furniture manufacturing firm, suffered from the genetic lung disease alpha-1 antitrypsin deficiency, which causes severe emphysema. Also, he was a long-term smoker.

McCall enrolled in an HMO that PacifiCare offered for Medicare patients. Pulmonologist Shukla and his medical group, Greater Newport Physicians Inc., were part of the plan.

Medicare paid PacifiCare a monthly fee for every patient in the program, regardless of how much care they required. The McCalls argued that they didn’t know he was a candidate for a lung transplant until 1997, when a nurse happened to ask him where he stood on the transplant list. The operation would have cost about $300,000.

In court briefs, lawyers for PacifiCare and Shukla argued that McCall made the decision not to have the transplant. The family’s attorneys said there was no mention in his medical records that his doctor had ever recommended it.

The suit alleges that McCall was forced to drop out of the HMO so Medicare would pay for the entire procedure. His lawyers said it is illegal to force a patient to leave an HMO to get treatment.

Jimenez said that the McCall family would have preferred the terms of the settlement be made public, but that the defendants did not. If Shukla’s portion of the settlement is more than $30,000, the amount must be reported to the Medical Board of California.

By not going to trial, the McCalls’ lawyers don’t get the chance to ask the judge for an injunction to require PacifiCare and other HMOs to disclose to patients how treatment options affect their doctors’ profits.

Even though it didn’t go to trial, the McCall case leaves behind an important legacy.

“It was a major breakthrough so elderly people have access to the court system when abused by an HMO,” said Mark Hiepler, an Oxnard attorney who won an $89-million jury verdict in 1993 against HealthNet for denying a bone marrow transplant to his sister, a breast cancer patient who died that year.