August 1, 2002 News



Managed Care

AMA and Spin City



First You Say You Will & Then You Won't


In Washington, Missouri, a group of physicians that are affiliated with St. John's Mercy Hospital have left the wing and are moving away from mother.  The physicians are building a medical office building off campus.  They are adding diagnostic equipment which will make the physicians competitors with the hospital.  St. John's has the typical hospital attitude of stating we will recruit others instead of trying to work with the group.  St. John's states they will build a linear accelerator at the hospital.  Of course, they said this after the medical group had applied for state approval to put one in their building.  The stubbornness and reactive thinking of hospital always amazes me.  

Modern Healthcare has a recent editorial criticizing the two Ohio organizations for their economic credentialing of physicians.  The editorial embraces the specialty hospital and uses the analogy of going to an oil change place of an oil change and to a department store for their gas and other sundries.  The article goes on to cite other cases of economic credentialing that have led to court battles and a loss for the old hospital even if they win the battle, which most have not.

Cheap is Cheap.  The Corpus Christi HCA hospitals are having the nurses, including those in the OR, wash their own scrubs at home.  This is not only against OSHA regs but is against all shreds of common sense except money.  The nurses now wear their scrubs from home to work instead of changing into professionally laundered scrubs at work.  I would hope the first person with an infection sues the hell out of the hospital and uses the OSHA standards to hang them high.

Continuing in Texas, a group of 40 physicians and a Hospital are coming together to build a short stay specialty hospital in the Dallas area.  The physicians will own about 50% of the hospital.  There will be no OB to bump the schedule and no ED.  The other hospitals in the area are not like Ohio.  They will not retaliate against the physicians, so will keep the physicians for those procedures that can not be done at the new hospital.

In Houston Medical Center, Georgia,  the hospital that changed pathologists without medical staff consent, is now losing 4/6 of its radiology department.  The four are resigning for unspecified reasons.  The original decision by the Hospital Authority of Houston County made in a closed session prompted a no confidence vote by the medical staff and are asking for a resignation of the Board.  This action by the radiologists may further that goal.  

At the Washington Township Hospital in Maryland, the physicians resigned closing the trauma center.  The local surgeons gave a two day notice that they will no longer staff the center.  They hope to re-open the center at sometime in the future with a new staffing model.  For now, all trauma victims are being airlifted to surrounding trauma centers.  This occurred after the CEO presented a proposal covering "contractual agreements and reimbursements".  Sounds like they need to open the purse strings if they want to reopen the trauma center.  

The only trauma center in Charleston, West Virginia is running short of orthopedic surgeons.  They have gone from 12 to five due to malpractice concerns and now two of the five are going out of town at the same time.  If they don't get temporary replacements they will have to close for those days and send patients elsewhere.  They also can't recruit any orthopedic surgeons to the staff due to the malpractice climate in the state.

The same is true in Los Vegas where the orthopedic surgeons are only nine in number and need twelve.  The physicians are quickly burning out and have to work double or occasionally triple shifts.  This makes for bad medicine and for the physicians to leave the center again.

I hate putting this under Physicians since this person does not deserve the title.  A British Family Practitioner has been accused of murdering 215 of his patients between 1975 and 1998. He has already been convicted of murdering 15 of the patients.  There has been no motive established for the mass murders.  The method of death was a lethal injection of heroin.  

The LA Times had an article on boutique medicine. The article acknowledges that this type medicine would not have occurred without the public's backlash against the faceless managed care. The current approximate 200 practices are full or close to it, showing that a segment of people want to have access to their physicians and are willing to pay for that access. The one senator from Florida who is up for re-election has introduced a bill to outlaw the practice.  He states the truth that if all physicians did it, it would be the end of Medicare.  Of course, that would not or could not happen. Medicare is for the masses, not the individual. The AMA has no problem with the boutique physician. Top

Managed Care

In 1999, Georgia paid no attention to the managed care seers that stated there would be increased law suits and higher prices if the legislature went on their way to allow appeals of decisions and greater patient choice.  The seers were wrong again.  Patients are appealing decisions and winning more than half of the time.  There has been no lawsuit regarding treatments, only the usual negligence.  Of course the Georgia reforms only apply to the non-ERISA plans.  The ERISA plans are still restrictive and probably cost more in money to defend decisions even though the plans win in federal court.  

The Peoples Republic of Massachusetts has been shown in a PriceWaterHouse LLP study to be responsible for many businesses either not offering medical insurance now or in the future.  Of every premium dollar collected 15 cents is die to federal or state mandates.  The People's Republic has 27 mandated benefit laws and another 44 in the hopper.  This is at the top of the United States.  Some of the latest ones will remove any flexibility of employers to manage their premium costs.   

Project Patient Care found in a recent survey of 1000 adults age 50 and over that they had their medications switched by their insurer to a formulary medication in 12% of the cases. The new drug was ineffective in 13% of the cases and 22% had side effects from the new drug.  When providers were polled they had an overwhelming bias, 78%, toward medications should be decided upon by the provider and not the insurer's cost. Will this make any difference?  No! The insurers still want the bottom line and they don't care about the patient.  

Health Plan of the Redwoods the bankrupt HMO asked the bankruptcy court to allow it to get rid of its Medicare+Choice plan at the end of August.  The judge said that the HMO had to give a 90 day notice and the earliest they could get rid of the plan was the end of October.  This is a case of asking for the sun to attempt to get the moon.  October is better than the end of the year when you are losing $1 million a month on the program.  After the patients receive the notice they have 120 days to get into a true secondary insurance plan without a physical.  There are no other HMOs in the area except Kaiser and they are full.

Michigan, the home of the companies that pioneered contracting with physicians, have dumped the HMOs.  The Medicare+Choice dropped by 50%.  The commercial HMOs lost 60,000 people in 2001. The only HMO that gained was the Medicaid HMO.        

In a story Modern Healthcare writes that only 61% of Medicare patients have access to HMOs.  This led to the conclusion that the Medicare+Choice plans may drop and stabilize at either 5 million or drop to 3.5 million people.  The current 5 million in HMOs are disproportionally poor and minority.   

The New York Times has an article regarding the difficulty for patients to obtain impartial outside appeals in a timely manner.  Since each state has its own rules and regulations regarding what hoops one needs to jump through, there is no unanimity of opinion.  Many people start the process and then just give up. As an example in New York there were over 25,000 denials appealed to health plans but only 900 made it through external appeal.  This may mean the health plan appeals are working or that the patients have given up hope.  Pennsylvania statistics seem to bear out the giving up theory.

PacifiCare violated Arizona law more than 1000 times between 1996 and 1998.  Arizona has now fined the insurer $125,000

The year long battle between Tenet and Health Net in California has come to a head.  Health Net has stopped all of its 577,000 Medicaid HMO patients from seeing any Tenet affiliated physician groups or go to any Tenet hospital.  The California Department of Managed Health Care is investigating the case.

KPC, the bankrupt IPA, has placed notices in the papers and stated there is only one month left for prior patients to obtain their medical records or they will be destroyed.  This was part of a federal judge approved plan made a year ago.

The AMA and 19 physicians are not happy campers with Anthem Insurance.  They have sent a five page letter to the insurer complaining of their illegal physician underpayments.  Anthem's response to the AMA is the same as toward physicians, evasion and doublespeak.  This hopefully will cost Anthem their contracts with the State Medical Societies and the physicians in the affected states.

The Jacksonville Business Times has an article about the pulling away from HMO and PPO insurances to more choice and flexibility.  They are pushing MSAs and multi-tiered plans. 

The Wall Street Journal has a front page article regarding the potentially illegal insurance practices of unilateral bundling of billed charges.  The article was truthful and not flattering to the insurers.  The spin was since some doctors fraudulently bill, we have to do this to all and not just punish the ones the do illegal deeds.  If the insurers lose the law suits against them for this practice, their stockholders will not be happy campers.          Top

AMA and Spin City

In the July 22 AMANews the always politic AMA did a great spin job. The headline spoke about physician pay relief.  The article talks about lowering the new Medicare pay scale from 5.1% to only 4.4%.  In case anyone keeps count this is a 10% pay decline in two years, hardly something to be proud of.  The rule would also double the amount paid for giving immunizations from $4 to $8.  This doubling will enable the doctor or nurse to spend the time explaining the immunization to the patient.  Right!  I hope that all remember that much of this was the direct result of the AMA agreeing to the balanced medical budget.  I also hope you remember the AMA fondly when it is time to pay your dues.  I'm speaking to the 29% of the American physicians that make up the AMA, most of whom must join in order to join their state organizations.        Top


The president-elect of the AMA is joining the 400 Florida physicians who protested the high cost of insurance with a demonstration.  The physicians are gunning for a California style malpractice reform bill. A counter rally by the 12 trial lawyers believed the current law is okay but the physicians are bad and the insurance company did the industry wrong.  I agree with the latter statement.  

In the midst of this crisis the physicians at Manatee Memorial Hospital in Florida just don't care enough to vote on changing the bylaws to not require malpractice insurance.  They are a disgrace for not voting.  Only 70 of a needed quorum of 116 showed up for a vote.  The remainder of the staff must of been on vacation.

In Boca Raton, Florida, two hospitals dropped their malpractice requirement.  Boca Community and West Boca hospitals dropped the requirement for fear of losing physicians who wish to go bare and their patients.  West Boca will require the physicians that go bare to post a sign in their offices that they have no insurance.  Meantime two OB/GYNs are giving up delivering babies and two more have dropped their malpractice insurance.  The two hospital's policy changes may affect other area hospitals who now may lose physicians and patients to the two who no longer require the insurance.

The Tampa Florida University Hospital has dropped its malpractice insurance requirements.  Tampa General had already dropped its requirement.  Bayfront Medical Center in St. Petersburg has refused to allow the malpractice requirement to be dropped.  I can see the physicians there, who are not tied to the hospital by money, start to change their allegiance.

The Florida trial lawyers are trying to get on the ballot two state constitutional amendments.  the first would be to ban doctors who are found guilty of malpractice three or more times.  the second is to give the public access to records on malpractice investigations.  I would hope that includes legal malpractice investigations.

In Los Vegas, the lawyers are getting nervous.  They took out a ad in the paper claiming the doctors are endangering lives by their refusing to put their families wealth at risk. They even brought up the war on terror and accused the physicians of being unpatriotic.  The attorneys see the handwriting on the wall and it says their gold digging days are over.  

The committee of Nevada's attorneys, physicians and insurers met and were unable to come up with a solution to the state's malpractice problem.  No surprise there and so it goes to a special state legislative meeting.   

Congratulations to the Nevada Trial Attorneys!  The above articles gave my bent that the physicians in the state would prevail.  I admit, I was wrong.  The legislature is going to pass a bill with a permanent extension of the $50,000 malpractice limit to those physician participating in the trauma program, a limit on the amount each doctor would be responsible to pay depending on their percent of fault, $10,000 fines for hospitals and insurers who fail to report disciplinary actions to the medical board, decreasing the statute of limitations to three years from four, elimination of the screening panel that was designed to get rid of frivolous cases and replacing this with a fast track program, putting monetary sanctions on attorneys who bring frivolous cases and a $350,000 cap on economic damages which would be fine.  However there are enough holes in the package to drive the Bellagio Hotel through.  The exclusions include brain damage, paralysis, total blindness, amputation and sterility.  It also would exempt the cases with "gross negligence" with "clear and convincing" evidence that there was the gross negligence.  There should be no more OB done in the state since the delivery may give brain damage or paralysis of an arm. Neurosurgeons should not do brain surgery since it may lead to brain damage. Orthopedic and vascular surgeons should be careful and steer away from any vascular procedure that may eventually lead to an amputation.  This law will not help the state OB problem.  Again, I give my heartiest congratulations to the trial attorneys for giving something and taking it away.  As an aside, I would recommend to the various medical specialty societies to boycott Los Vegas until they pass meaningful reform.  One can't do that with most of the other states with malpractice problems, as no one goes there.

The Nevada Senate has just passed their version which would delete all the exceptions to the $350,000 caps except for the gross negligence and the clear and convincing evidence standards that the bill should exceed the cap.  This is vague enough to keep all the physicians at risk.

In Mississippi, the governor will call a special session this summer to consider the malpractice situation and pass some tort reform.  There will probably not be any meaningful action in this state where the trial lawyers control the roost.  The only thing that will get the needed reform is the closing of any trauma center or the OBs dropping deliveries.    

The Truman Medical Center in Kansas City was a level 1 trauma center until several month ago. One of their neurosurgeon's contract ran out and left them without enough coverage.  They have now contracted with the University Physicians Association, North Kansas City Hospital and the University of Kansas to supply enough neurosurgeons to regain their Level 1 status.  This will become more frequent as neurosurgeons assess haw much money it costs them in malpractice premiums to provide trauma coverage.

In San Antonio the University Health System is also losing neurosurgeons and must send patients with head injuries out to the local military hospitals.  The University gets its funding from the state who routinely looks for ways to reduce costs.    

As all this has gone on, the trial lawyers have been doing what they do best.  The trial lawyers are the largest donors to the United States Senate Democrats.  These impartial people have decided that the President's tort reform plan is not worthy  and turned down any tort reform, just like good little bribees are supposed to do.     Top


In a terrible bit of news two Floridians were infected with HIV from a blood transfusion.  This is the second known occurrence since 1999.  The reason is the donor had contracted the disease too early for the viral load to be detectable.  It takes 7-10 days for the load to reach detectable proportions.  The first case was last year in Texas, for the same reason.  The kicker in this case is that several times in the past ten years the Florida Blood Services has been warned by the FDA about its handling of blood testing for HIV. One was for improper testing, another was for improper disposal of the HIV blood, and the last for improper syphilis testing.     Top

First You Say You Will & Then You Won't

Last week the Chicago Tribune had an article about the injuries to patients from hospital acquired infections due to unsanitary conditions.  As part of the article they interviewed a surviving husband of a woman who died following a cardiac bypass at Bridgeport Hospital in Connecticut.  The husband had sued the hospital and there was a confidential settlement.  When Bridgeport found out the husband had discussed the case, they sued the husband.  Several days later they withdrew the suit after a storm of negative publicity to the hospital for their mean-spiritedness.  The same was true for another couple who also sued for their infection.  The hospital states it withdrew the suit so the public can focus on their current infection rate of less than 1%.


DISCLAIMER: Although this article is updated periodically, it reflects the author's point of view at the time of publication. Nothing in this article constitutes legal advice. Readers should consult with their own legal counsel before acting on any of the information presented.