GA Supreme Court rules in favor of optometrists

The Georgia Supreme Court recently ruled in favor of a group of optometrists in a case against Spectera Inc., a vision care insurer. It is unclear how this ruling may affect other vision plans.

In 2010, Steven Wilson, OD; David Price, OD; Cynthia McMurray, OD; and Jodie Summers, OD; of Valdosta, GA, filed suit against Spectera when the company informed them that it would amend their contract by switching to an independent participating provider (IPP) agreement. Under the IPP, independent providers would be required to obtain all covered materials from Spectera’s optical laboratory, while retail providers would continue to be permitted to obtain the materials from any source.

Dr. Wilson filed suit against Spectera, arguing that the IPP agreement violated Georgia’s Patient Access to Eye Care Act. Spectera then terminated its provider agreements with Drs. Wilson, McMurray, and Summers. Dr. Price also filed a suit against the company after it failed to accept him as a provider based on his refusal to sign the IPP agreement. Those lawsuits, along with an additional suit filed by Drs. McMurray and Summers, were consolidated. The court entered a pre-trial injunction to prevent Spectera from terminating the provider agreements until lawsuit was decided, and the trial court issued a permanent injunction, prohibiting Spectera from enforcing the IPP agreement.

The court denied Spectera’s request to lift the injunction, instead making it a permanent injunction.

On appeal, the Georgia Court of Appeals agreed with the plaintiffs that the IPP agreement violated three sections of the Patient Access to Eye Care Act. The subsections violated prohibit eyecare providers (ECP) from providing services directly to their patients and restricts the licensure of an ECP’s practice; and protects practices from being arbitrarily denied admittance onto an insurance company’s provider panel. However, the court didn’t believe the IPP agreement violated a subsection that prohibits the company from offering a more favorable contract to retail providers, which would put private-practice providers at a disadvantage, and drive patients to the retail chains.

In its appeal to the Georgia Supreme Court, Spectera argued that the court misinterpreted the Patient Access to Eye Care Act. 

Spectera’s attorneys, Michael Bowers, M. Anne Kaufiled-Wiggins, and Cavender Kimble, argued that, “The Court of Appeals’ decision misconstrues the statute ...and leads to absurd results that inevitably will raise premiums and reduce access to eye care.” Spectera further argued the optometrists were not fighting for patient access, but rather to “preserve a lucrative revenue stream for contracted providers…who want to obtain the materials they sell to [Spectera’s insured patients] from a lab of their own choosing rather than supplying them with the same products from Spectera’s lab.”

Attorney Walter Elliot, plaintiffs’ attorney, argued the IPP agreement limits the ODs’ function to dispensing and fitting eyeglasses and contact lenses prepared and supplied by Spectera’s optical laboratory, and the plaintiffs would “not be able to ensure the provision of timely eye care and would not be able to ensure the provision of quality eye care to their patients covered by Spectera’s plan.”

The plaintiffs refuted Spectera’s “lucrative income stream” claim, and said, “There is no evidence that Spectera’s proposed agreement will reduce costs or maintain premiums.”

The Georgia Supreme Court sustained the Appeals Court’s ruling that the IPP agreement violated a subsection of the Act that allows patients to obtain services directly from the licensed ECP on the health benefit provider panel. 

The Supreme Court reversed the Appeals Court’s decision regarding the violation of the subsection that an vision care insurer “shall…allow each eye care provider on a health benefit plan provider panel, without discrimination between classes of eye care providers to furnish covered eye care services to covered persons to the extent permitted by such provider’s licensure.”

The court also found that Dr. Price was justified in not signing the IPP agreement, as it violated the Act, and Spectera was wrong to deny him as a provider, as a subsection of the Act “clearly prohibits insurers from barring new providers to its panel based on reasons unrelated to the provision of eye care. The signing of an unlawful contract is unrelated to the provision of eye care.”

The court felt that permanently barring Spectera from terminating its contracts with Drs. Wilson, McMurray, and Summers, “goes too far,” but any termination must be for legal reasons.

“The Supreme Court decision said that Spectera cannot preclude a patient from receiving any services-exams, and the services of preparing and dispensing any materials-directly from their provider,” Dr. Wilson said.

And while “Spectera is going to have to comply with the Supreme Court opinion,” with regard to their contracts Dr. Wilson said, he expects other vision care insurers in the state to comply, as well.

The National Association of Vision Care Plans, which represents the managed vision care industry, filed an amicus curiae brief for the case, siding with Spectera, to ensure other vision care insurers are aware of the case.ODT