Judge tosses
health plan lawsuit

Nevada company alleged it
was kept out of the local market

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By Lyn Danninger
ldanninger@starbulletin.com

A federal judge yesterday dismissed a lawsuit alleging that two Hawaii health care organizations, a consumer group and a number of physicians conspired to fix prices and prevent a new health plan from entering the local market.

The suit, which had asked for $65 million in damages, was filed by International Healthcare Management, a Nevada company set up to administer the new plan, known as the St. Francis Preferred Provider Plan, and Hawaii Health Network, the arm of the plan that would contract with physicians to provide medical services to plan members.

After reviewing briefs filed with the court and listening to arguments from both sides, District Court Judge Helen Gilmore ruled in favor of the defendants' motion to dismiss complaints against The Hawaii Coalition for Health, The Hawaii Medical Association, Queen's Physician Group, and doctors Arleen Jouxson-Meyers, Peter Locatelli, Leonard Howard, Lockwood Young and John Drouilhet.

The attorney for the coalition, Meyers and Locatelli described the court's decision as "a vindication."

"We are very happy with the division. We feel it was a correct and careful decision and that all the parties had plenty of time to present their case," said Rafael del Castillo.

International Healthcare Management and Health Hawaii Network in 1998 formed a joint venture with the St. Francis Health System to set up the new plan. The complaint alleged that the defendants influenced doctors not to participate, and therefore International Healthcare Management was unable to obtain a physicians network that was both marketable to employers and met requirements set up by Hawaii's Pre-Paid Health Care Advisory Council.

As a result, the company said it was not able to successfully market its product to employers in Hawaii and could never get off the ground.