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Master's Professional Reports Abstract

Senate Bill 386 and the Use of Alternative Dispute Resolution
Hall, Robert Tremaine
REPORT 1999 H146 Public Affairs Library

Texas' Senate Bill 386 was passed in the 75th Legislative session to address a perceived shortcoming in Texas tort law: HMOs were shielded from tort claims based on adverse medical payment decisions. Opponents claimed that the law would lead to lengthening court dockets and lost revenue for HMOs, that it was pre-empted by the federal Employee Retirement Income Security Act (ERISA) and that it would lead to less health care coverage for average citizens in the state. While only two cases have been filed under SB 386 (one of which answered the ERISA pre-emption question), health care coverage for citizens in Texas has steadily decreased. Many agree that there is in fact a crisis in health care in this state, one that should be dealt with so that health care costs do not rise more quickly due to the new law.

Alternative Dispute Resolution may be the answer. The use of alternative dispute resolution (ADR) in the United States is growing quickly. ADR has been used to create unique and effective solutions for children in schools, litigants in civil suits, and federal government agencies through regulatory negotiations. This professional report argues that increased use of the health care payment dispute would be fruitful. By implementing one more step in the review process, adverse medical payment disputes may not clog dockets, lead to as great an increase in health care cost, and may be resolved more efficiently for all parties than through the fast-track to litigation that SB 386 currently provides.


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