In a closely watched case, the Third Circuit has opened awide doorway for tort suits against health maintenanceorganizations, ruling that federal law does not pre-empt theright to sue if policies result in inadequate medical care.

On Sept. 16, the court allowed Steve and Michelle Bauman toproceed in New Jersey state court on their claim that their HMO’spolicy discouraging hospitalization of newborns resulted in thedeath from meningitis of their 2-day-old daughter.