Two coalitions of law firms are scrambling to recruit practicing psychologists as clients in suits against the American Psychological Association (APA) that the lawyers believe will bring multi-million dollar damage awards for APA members who paid practice assessments in the past 10 years.
APA officials contend the suits are unfounded and will fail.
Both suits in the U.S. District Court for the District of Columbia contend practitioners were led to believe the assessments were mandatory although that would violate federal law, at least since the APA Practice Organization (APAPO) was formed in 2001.
The suits are largely identical but were filed independently, which has created a competition between two groups of trial lawyers each seeking to represent as many practitioners as possible.
Attorney Mark S. Baumkel of Bingham Farms, Mich., is with the coalition that filed the first suit Oct. 21. The coalition includes the Washington, D.C., law firm of Tycko and Zavareei LLP. That suit lists Ellen G. Levine, Ph.D., of Hayward, Calif., as lead plaintiff.
Attorney Mark J. Tamblyn, who works from the Sacramento, Calif., offices of Wexler Wallace LLP, a Chicago-based law firm, is a spokesman for the second coalition, which includes attorney Greg Coleman of Knoxville, Tenn., and attorney Gary E. Mason of the Washington, D.C., law firm, Mason LLP. That suit, filed Nov. 4, lists Eric S. Engum, Ph.D., a Knoxville neuropsychologist, as lead plaintiff.
The suits seek repayment of the assessments on grounds that members were deceived into believing they had to pay the assessments to keep memberships in APA. The suit filed by Tamblyn contends APA illegally collected $4.5 million to $5 million over the past 10 years.
APA’s practitioner members were first charged a “special assessment” of $50 in 1985 to create a separate fund that APA could use to pursue practice goals, such as advocating for higher payment rates from Medicare and managed care organizations. (See “background and significance” on Page 4.)
APAPO was formed when APA officials feared increased lobbying efforts on behalf of practitioners could endanger APA’s non-profit tax status. APAPO was organized as a 501c(6) entity with broader lobbying powers but lesser tax exemption than APA, a 501c(3) organization.
Baumkel contends it was at that point that APA began violating federal tax laws. “They (APA officials) are acting as the collection agency for the c(6).”
In effect, he said, APA oversees the work of APAPO, setting up a legal master/servant relationship. The “master” is not allowed to have the “servant” perform acts that are legally forbidden for the master, Baumkel said.
Individual assessments have grown with cost-of-living adjustments, reaching $137 last year for a full-time practitioner, roughly doubling the cost of dues.
Baumkel does not appreciate the competition for clients and calls the second action filed a “copycat” suit. “We filed our suit, and it looks like they (the second legal coalition) read ours and filed a similar suit,” He said. “I don’t know that really, but it looks that way.”
“He’s incorrect,” Tamblyn said. “We’ve been researching this suit a long time, well before he filed his claim.” Tamblyn said careful research is prerequisite for major suits. “They don’t always involve a race to the courthouse.”
By mid-December, Baumkel said his group had clients from “six or seven” states signed on for the suit and will accept more from any state in the nation. He said prospective clients should contact him at: email@example.com.
Tamblyn said his group also will accept additional plaintiffs. Those interested should e-mail him at MJT@wexlerwallace.com or call the office at 916-492-1100 and ask for him or attorney Neha Duggal.
Rhea K. Farberman, APA’s executive director of communications, said APA will defend against both suits vigorously. “We consider the allegations in the complaints to be completely baseless and without merit,” Farberman said.
The APA and the APAPO boards of directors issued a joint message to APA members in December denouncing the suits. (The makeup of the boards is identical; APA board members automatically also serve as APAPO board members.)
“APA and APAPO have never misled their members into paying dues or assessments,” the message said. It went on to explain that APAPO was created to allow greater advocacy on behalf of members who are licensed to provide health care services and has been very effective in those efforts.
APAPO’s achievements were listed as: helping to pass full parity at the federal level, protecting reimbursement rates including restoration of Medicare psychotherapy payments, pursuing having psychologists included in the Medicare definition of “physicians,” supporting lawsuits against abusive managed care practices, protecting the doctoral degree as the standard for independent practice as a psychologist, advocating for appropriate scope of practice in hospitals and integrated care settings and creating the health and behavioral procedure codes for psychologists in those facilities.
“Practice assessment fees have directly supported these victories,” the message said, noting that each board member pays the practice assessment at the level appropriate for his or her involvement in health care.
“Our collective message is that we very much believe in the legitimacy and value of funding the advocacy work of the APAPO and believe the benefits to professional practice and the patients we serve provide a substantial return on our assessment payments.”
The issue of whether the assessments are voluntary rose to the level of litigation after an extensive exchange of e-mails and listserv postings among members following a posting last March by the federal advocacy coordinator for APA’s Division 12 encouraging practitioners to “consider” paying the assessment to support the Practice Organization.
Several members questioned whether that meant that the assessments, which many had considered mandatory, were in fact voluntary. In May, the APA/APAPO boards of directors posted an explanation that the assessments are needed to support APAPO efforts but no member has ever been denied APA membership for not paying the assessment.
The explanation added that those who pay the assessment are members of APAPO and receive additional services, such as “action alerts” on matters before Congress that could affect practitioners.
The cyber exchanges included heated comments from many members who thought all along that the assessments were mandatory because they were billed together with regular APA dues. A random survey by The National Psychologist determined that even several members who had held high office in APA believed the assessments were mandatory until APA/APAPO announced it would reword billings for 2011 dues to clarify that the assessments are separate from regular APA dues.
In 2010, about 35,000 APA members paid assessments, ranging from $25 for a psychologist in the first year of practice to the full assessment of $137. The full assessment rate for 2011 is $140.