April 15, 2002 News

 

Florida HMO's Poor Ratings

Managed Care

Economic and Exclusive Credentialing

VA System

General Surgical Residencies

Malpractice

Florida HMO's Poor Ratings

The South Florida Business Journal has two recent articles on patient satisfaction in the area.  The first one ranked the state's HMOs and found that over half of the organizations ranked below average in overall customer satisfaction.  The University of Florida conducted the survey.  They used the NCQA grading system where the average is 3.2 of five.  Some of the largest HMOs had the lowest grades.  This included Beacon Health Plan with 1 in low complaint section, Humana 2 in overall satisfaction.  Both got high grades for blood pressure control. Cigna got its one for overall satisfaction.  The best was Preferred Plan of Miami which rated 5 in all categories except blood pressure control where it got a four.  

In the second article the paper told about the problems of the ratings and their conflicting information.  There are other rating systems that only look at the financials of the companies.  Many businesses do not look at this since they do not care if the plan can pay the claims.  They know someone will.          Top

Managed Care

The New Mexico Business Journal believes there could be less physicians in the state due to the 5.4% Medicare reduction.  This, they say, translates into a fifteen percent reduction in physician pay.  In one group of 26 physicians they have already lost three. They blame it on a combination of the lower payment and the onerous gross receipt tax and a personal income tax of 8.2%.  The gross receipt tax can be passed on to all consumers except those of physicians by state law.  The physicians also state that the HMOs have raised premiums and are paying physicians less.  This along with the philosophy of every hospital needs every new gadget is decreasing the amount of the pie available. 

A Tufts University Professor has studied the high cost of all providing everything and found of course that it does cost more.  He recently focused on the New England Journal article of implantable defibrillators.  This now cost about $30,000 per implant and there will be about 400,000 needed in several years. This adds up to about $3 billion and a cost per life saved of about $500,000.  There is now no way to predict the patients who will really need the defibrillators so all will get them.  As technology continues to advance the costs will likewise be greater.  Who is going to say "no you can't have your life saved"?  

In New York a hospital is realizing the above and is closing its emergency and its inpatient centers.  Amsterdam Medical Center is becoming an outpatient facility.  The area has another hospital and instead of fighting them, Amsterdam looks to complement their services.  Some of Amsterdam's workers will be hired by their competitor.   

On of the major bones of contention between physicians and health plans are the provider directories.  If the physician has resigned from the organization and the new book that comes out has his/her name, this is false advertising.  The managed care organization is using the name and reputation of the physician to lure consumers into it's net.  When the consumer finds out that the physicians they wanted is not in the network they become angry with the physician and secondarily frustrated and angry with the organization.  The organizations state they can not keep their roster current, which is true.  However, they could check the names of the providers when the new directory is issued.  There is currently a law suit now by a doctor who is not in a Beech Street PPO.  The organization has his name in their directory but states he is not accepting new patients, a blatant lie.  The doctor won the case and the only thing left to be decided is the amount of damages.   

PacifiCare, a California HMO was caught so much flack for their arbitrary and dangerous policy of huge co-payments for cancer treatment that they have instituted a change.  They are now reducing their co-payments to reasonable levels except for the drugs that help keep people alive and asymptomatic for a longer time such as Taxol for breast cancer and Lupron for prostate cancer. These will cost a very high deductible.  Of course if people live, which is doubtful, they will get am income tax deduction.  Please see legal section  for additional story on PacifiCare.

In an additional PacifiCare story the prior CEO Christopher Wing, who led the organization into its losing position has been hired to lead Heath Net.  Don't buy their stock.

West Virginia's Charleston Medical Center is selling a satellite hospital to another entity.  The hospital is having problems getting physicians to come to the area due to the high cost of malpractice insurance.  The purchasing organization, CHS, states they can get physicians fro their current hospitals to go there.  True, if they will pay the malpractice insurance, cost of relocating and a kicker.   

A North Carolina paper has a story about the HMOs loosening up their policies and bringing back customers.  The downfall of HMO attendance associated with the rise in PPOs have made the companies more user friendly and more like PPOs.  The new friendly open access HMOs have increased premiums dramatically so they are now almost the same as PPOs.  It is possible in the future with rising costs to see PPOs place the old HMO restrictions on their plans.   

Louisiana's Oath, one of the state's largest insurer is insolvent. The state is starting to take over the company.  The 82,000 consumers will go to other companies, mainly United HealthCare of Louisiana.  

Yes, Virginia there is socialized medicine.  The BBC has reported that Kaiser does a better job treating patients than the British Health Service does and at a price only 10% above the Brit's National Health Service.  Of course in GB the medicine is financed by taxes as opposed to premiums.  Nobody doubts that the private sector is much better than the public one.  The major differences were a 20 minute visit versus 8, twice the number of OB and cardiologists at Kaiser, Kaiser specialists would see patients in two weeks as opposed to 13 in Jolly Old, and Kaiser kept patients only a third as long in the hospital as the NHS.           Top

Economic and Exclusive Credentialing

A Maine hospital, Central Maine Medical Center, has given a contract to its cardiologists that prohibits their working at any competitor's hospital.  This is to make sure the hospital has a steady stream of patients to pay for the new building.  This will impact some physicians from Maine Medical Center who have the only heart program in the state and does over 2000 angioplasties and 1000 open heart surgeries per year.  The State of Maine officials did not know about the offensive contract when they gave the CON to Central or, they state, they would have made them remove it.  The legislature is now to consider a bill to make economic credentialing illegal.   Good for Maine!    

After Maine stated they would look into Central Maine the hospital changed it's mind.  The spin is it was never their intent to limit the patients from seeing their physician.  And it don't rain in Indianapolis in summertime.  The heart center that is being built instead of limiting the physicians who currently work at the Lewiston hospital will place the physician who do work exclusively there on an employment contract and will not be able to work elsewhere.

On a LISTSERV I belong to an attorney posted the question of two hospitals each with their separate exclusive contracts merge.  The hospitals in their merger that the major hospital would agreed to adopt the contracts of the hospital being acquired.  What to do?  I responded that it served them right for their exclusive contracting.  They either need to allow both to keep their exclusive contracts or pay for the two groups to merge.  If they do neither, there will be a no win, except for the attorneys, law suit. The asking attorney in a responding email agreed.        Top

VA System

Veterans are entering the VA system in droves due to rising drug costs. This has put such a strain on the system that in parts of the country there is a year wait to see a physician.  In St. Petersburg, Florida, the next appointment to see a physician is in 2005.  The system's pharmacy spending has risen 160% as opposed to a medical increase of 42%.  The new rules allow access to all veterans with at least 2 years service if discharged after September 7, 1980 and any National Guard member that has been on active duty. Due to fiscal concerns, the VA will stop enrolling new people in Category 7 as of the 2003 fiscal year.  This is the fast rising category that includes non-disabled, non-poor people without a service connected medical problem.  This is causing a major problem in Congress.  The pro VA legislators want no significant co-pays, while the VA states it will run over a billion dollars in the hole without them.  I continue to preach that the VA system has long outlived it's usefulness. It now only services the pork of the legislator's home district. There is not a need to place into this system people without service connected disabilities.  There is not a need for the service at all.  The service connected people could be put into either the Medicare or Federal programs with all costs paid by the government.  This could possibly save many billions of dollars with greater value for all concerned. The reason for the recent switch from retired to two year people being allowed in the VA was a decrease in the census.  That has now been corrected.       Top

General Surgical Residencies

The number of applicants for general surgical residencies have showed a small but continuous decline in the past few years.  The consensus is that this is because of long and unpredictable hours and the requirement of more family quality time.  Another less important problem is the decrease in reimbursement for the long hours.          Top

Malpractice

Missouri has entered the malpractice spiral.  The Show Me state has been showed.  The malpractice increases for the Kansas City physicians go up to 100% above last year.  This will add to the pressure throughout the country to have tort reform, much to the dismay of plaintiff attorneys.  The state Department of Insurance is monitoring the situation and is poised to move if the problem becomes too acute.

West Virginia continues to face the malpractice problem.  The only three neurosurgeons in Charleston may quit May 1 if they can not find affordable insurance.  This would cause the trauma center to close.  The neurosurgeons would be required to pay $140,000 per person for the first year with yearly increases.  They also have to buy their tail from St. Paul Insurance for a mere $620,000.  Obviously, there will be no neurosurgeon with a brain left in town or possibly the state.  It is possible that a hospital will pay for part of the tail.  That would help, but if it was me not enough. 

Washington state has been feeling the malpractice jitters for about a year.  Now the Insurance Commissioner is starting to become actively involved.  He is giving the insurance companies the choice to become voluntarily helpful in finding affordable insurance or he has the power to force the companies.  The commissioner made the move after the largest clinic in a county closed on April 1.  This has led to a major ED influx of patients.  The commissioner then found malpractice insurance for the clinic at a 160% increase.  The clinic reopened.  If the commissioner can help one clinic he could help all the physicians.  For many of the physicians the problem has gone from one of availability to one of affordability.  This is bringing the issue of tort reform to the Northwest.            Top

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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.