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Protection for Purdue Pharma Owners in Opioid Bankruptcy, Spike in Health Insurance Claim Denials & More

June 02, 2023 (2 min read)

Court Allows Purdue Pharma to Shield Sacklers in Opioid Bankruptcy

The New York-based 2nd U.S. Circuit Court of Appeals ruled that members of the Sackler family who own bankrupt Oxycontin manufacturer Purdue Pharma could be shielded from current and future civil claims by giving up control of the company and contributing up to $6 billion to a trust for paying states, hospitals and victims of opioid addiction who have sued the company. The court said U.S. bankruptcy law granted such legal protection for parties like the Sacklers who weren’t declaring bankruptcy themselves.

Deborah Hensler, a professor of dispute resolution at Stanford Law School, said the ruling pushed the boundaries of “what we understood commercial bankruptcy to be about” and could spur other corporations to seek the same liability protection. (REUTERS, AXIOS)

Rate of Health Insurance Claim Denials Up

A recent study by KFF revealed that even when patients obtained care from in-network doctors and hospitals, their health insurers still denied 17 percent of their claims, on average, and in some cases unjustifiably. While some insurers denied only 2 percent of claims, one insurer rejected 80 percent of claims in 2020.

The high rate of denials may be due in part to automation. A recent investigation of Cigna by ProPublica found that the insurer has been using a system called PXDX that enables its medical reviewers to process 50 charts in 10 seconds, likely without actually looking at the patients’ medical records.

The KFF study also showed that only one in every 500 denials was appealed by insureds. (KFF HEALTH NEWS)

Racism Rampant Problem for Nurses

A survey of 900 nurses by the Robert Wood Johnson Foundation found that 80 percent had seen or experienced racism from patients, while 60 percent had seen or experienced it from colleagues. The survey also indicated that less than 25 percent of nurses reported the incidents, with some telling pollsters they thought they would get little help from HR officers, administrators or even union leaders. (STAT)

CA Hospitals Push for Broad Bailout

Due to legislation passed in 2009 that allowed California hospitals to tap billions of dollars more per year in taxpayer money to provide care for patients in the state’s Medicaid program, known as Medi-Cal, but also enabled wealthier hospitals to siphon healthcare tax dollars from poorer ones, some of those less affluent hospitals, which serve more Medi-Cal patients, are facing cuts or closures. But the California Hospital Association is pressuring Gov. Gavin Newsom (D) and state lawmakers for a $1.5 billion emergency infusion and a new healthcare tax that would benefit all hospitals in the state, even those that are profitable. (FIERCE HEALTHCARE)

—Compiled by SNCJ Managing Editor KOREY CLARK

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