1. CMA Sues WellPoint for Ingenix Price-Fixing Scheme
CMA and AMA joined individual physicians and other state medical groups to file a class action lawsuit against health insurance giant WellPoint. The lawsuit, filed in Los Angeles federal court, alleges that WellPoint colluded with Ingenix, a unit of United Health Group, on a price-fixing scheme that relied on an obscure database to set artificially low reimbursement rates for out-of-network care.
WellPoint – which operates as Blue Cross in California – is legally bound to pay “usual and customary” rates for care provided to its enrollees by an out of network physician. Patients pay any additional amounts over and above what WellPoint decides to pay for those services. To determine these rates, WellPoint uses a database owned by Ingenix .
“Health insurers are data manipulating to set rates artificially low, forcing patients to pay more than they bargained for when they go to a doctor of their choice,” said Dr. Dev GnanaDev, CMA president. “This undermines the patient choice that insurers promise when they tout their PPO products and undercompensates doctors for the care they provide.”
A recent investigation by New York Attorney General Andrew Cuomo concluded that the Ingenix data is intentionally manipulated to allow health plans to scam physicians by shortchanging reimbursements on medical bills. A WellPoint executive acknowledged “conflicts of interest in the Ingenix database,” and the company agreed to pay $10 million to help fund a new database run by an independent nonprofit organization. The settlement did not, however, seek redress for patients and doctors.
“As health care costs continue to rise, insurers appear to be scheming to find ways to shift resources to their bottom line rather than towards the health care of their enrollees,” said CMA President Dev GnanaDev, M.D. “CMA will continue fighting to obtain relief for patients and physicians who were harmed by the systemic flaws of the conflict ridden Ingenix database.”
Contact: Samantha Pellon, 916/551-2872 or spellon@cmanet.org.
2. Anthem Blue Cross Requires Physicians to Take Pay Cut for
Treating Healthy Families Patients
Anthem Blue Cross recently notified approximately 53,000 physicians statewide that they would have to sign a separate contract and accept reduced rates if they want to continue treating Blue Cross-insured Healthy Families and AIM patients. Effective July 1, these patients will no longer be able to access physicians through Blue Cross’s Prudent Buyer contract. According to Blue Cross, the new lower rates will be “in line with the funding for these programs.” Physicians who do not have Prudent Buyer Contracts but contract with Blue Cross for Healthy Families/AIM only will also be required to sign a new contract in order to continue to provide services to patients enrolled in these programs. Patients and physicians in 43 counties will be affected by this change. (Blue Cross does not participate in the Healthy Families and AIM program in Alameda, Contra Costa, Fresno, Monterey, Sacramento, San Francisco, San Mateo, Santa Barbara, Solano, Stanislaus, and Yolo counties.)
Physicians may request a copy of the new contract by contacting Blue Cross at 877/811-3113 or ssbrecruit@wellpoint.com. (Contracts will be available the second week of April.) CMA has requested a copy of the contract and will provide members with an analysis soon.
Physicians are reminded that before they sign a health plan contract, it is important to know what value that relationship will bring to their practice. You do not have to accept contracts that are not mutually beneficial.
To help physicians negotiate and manage complex third-party payor agreements, CMA has published a contracting tool kit, “Taking Charge: Steps to Evaluating Relationships and Preparing for Negotiations—A Focus on Payor Contracting.” The tool kit is available free to members at the members-only website. Nonmembers can purchase the tool kit for $100 in the CMA bookstore.
Click here for more information.
Contact: Aileen Wetzel, 916/551-2037 or awetzel@cmanet.org.
3. State Budget Update: The Good, The Bad, and The Ugly
There has been some recent action related to the state’s ongoing budget deficit, and unfortunately it hasn’t all been positive.
The Good: Medi-Cal Eligibility
Last week, the Governor signed a bill (SB 3X 24), which will temporarily rescind the semi-annual renewal requirement for children in Medi-Cal and allow the state to receive over $10 billion additional dollars from the federal government over the next 27 months. As a condition of the deal, semi-annual eligibility renewal will be reinstated once the increased federal dollars expire. (As part of the budget signed last September, California moved from annual to semi-annual reporting for children in Medi-Cal.)
The Bad: Medi-Cal Optional Benefits
On Friday, the state treasurer and the Department of Finance announced that California’s share of the federal economic stimulus dollars that will be in place by June 30, 2010 will fall short of the $10 billion “federal trigger.” Because of this shortfall, a number of optional benefits will be cut from the Medi-Cal program effective July 1, 2009 (including adult dental, acupuncture, audiology and speech therapy, chiropractic, optometric and optician services, podiatry, psychology, and incontinence creams and washes).
The “federal trigger” is a provision in the recently-passed state budget that would have authorized the elimination of a number of planned spending cuts and tax increases if California’s share of the economic stimulus money was forecast to be equal to or greater than $10 billion by June 30, 2010.
The Ugly: Ballot Measures
Last week the Public Policy Institute of California released a poll showing that five of the six ballot propositions slated for the May 19 special election have less than 50 percent support. If those five are defeated, California’s projected budget deficit for the remainder of this year would go from $8 billion to more than $14 billion.
The largest single source of revenue among the six measures is Proposition 1C, The Lottery Modernization Act. This proposition would allow the state to borrow against future lottery revenues. This measure alone would cost the state more than $5 billion if it is defeated.
Contact: David Ford, 916/444-5532 or dford@cmanet.org.
4. CMS Clarifies “Community Call Plan” Regulations
Last October, the Centers for Medicare and Medicaid Services (CMS) finalized regulations that allow hospitals with emergency departments to cover physician on-call responsibilities through community plans that coordinate resources across multiple facilities. Community call plans can provide regions with greater flexibility and ease the burden on physicians who find it hard to maintain taxing emergency call schedules because of specialty physician shortages throughout the system.
Last month, CMS provided much needed guidance about how the regulations will be enforced and what hospitals and medical staffs need to do to comply with the new rules. CMA On-Call document #1216, “Emergency Transfer Laws: Medical Staff and On-Call Requirements,” has been revised to reflect this latest information.
On-Call documents are free to members. Nonmembers can purchase On-Call documents for $2 per page in the CMA bookstore.
Click here for more information.
Contact: Samantha Pellon, 916/551-2872 or spellon@cmanet.org.
5. Assembly Passes COBRA Subsidy Bill
With a wide bipartisan vote, the state Assembly passed a CMA-supported bill (AB 23), which would modify state law to allow Californians who have lost their jobs to receive federal subsidies for COBRA benefits. Currently COBRA allows laid off workers to continue their health insurance benefits at their own expense. The federal economic stimulus bill authorized the federal government to cover 65 percent of COBRA premiums for workers laid off between September 1, 2008, and December 31, 2009.
The bill will require insurers to notify laid off workers of the availability of the federal subsidies. It will also give workers in small companies, who are covered by California’s “Cal-COBRA” law, a second chance to enroll in a COBRA plan if they lost their job between September 2008, and the date AB 23 becomes law. CMA believes that this bill will help unemployed Californians to keep their coverage and keep them out of already-overburdened public programs.
The bill now goes to the state Senate, where it is also expected to receive bipartisan approval.
For more information on this and other bills of interest to physicians, see CMA’s Legislative Hot List.
Contact: David Ford, 916/551-2554 or dford@cmanet.org.
6. CMA’s Democratic Process at Work: Council on Legislation Sets Legislative Priorities for 2009
CMA’s Council on Legislation (COL) – comprised of more than 60 physicians from around the state – recently met in Sacramento to discuss the association’s legislative priorities for 2009. The council members, who are nominated to COL by their delegation, county medical society, or specialty society, meet annually to discuss and recommend CMA’s position on numerous pieces of legislation pertaining to the house of medicine. All CMA members are welcome to attend COL and voice their opinion.
Among the topics covered at this year’s COL were: The corporate practice of medicine, regulation of physician owned surgery centers, scope of practice, and Medi-Cal TAR reform.
Council members also heard presentations from CMA senior staff on hot button heath care issues, including federal health reform and peer review.
The COL’s recommendations now go to the Board of Trustees for approval at the next board meeting.
For more information on bills of interest to physicians, see CMA’s Legislative Hot List.
Contact: Julia O’Brien, 916/551-2567 or jobrien@cmanet.org.
7. Webinar: Red Flag Rules
CMA is hosting a live webinar on April 16 from 12:30 to 1pm to help members understand and comply with the FTC’s new “Red Flag” identity theft rules. CMA’s Director of Litigation Long X. Do will discuss these new rules, which require “creditors” – including physicians – to develop and implement identity theft detection and prevention programs by May 1, 2009.
For more information or to register, visit the CMA calendar.
Contact: Shannon Navarra-Lujan, 800/786-4CMA or slujan@cmanet.org.
8. Physicians Encouraged to Donate to Ovarian Cancer Research
Last year, CMA supported Assembly Bill 1935, which created the California Ovarian Cancer Research Fund and authorized the addition of a check-off box on state tax returns to encourage individuals to donate a portion of their refunds for this purpose. The fund will be administered by the University of California.
As tax season is upon us, CMA encourages physicians to consider a donation to ovarian cancer research when filing their 2008 state income tax returns. Physicians are also urged to ask their friends, family, and colleagues to do the same. This is a perfect opportunity to increase the education and awareness of this disease and raise much needed funds for research. As there is a minimum annual threshold of $250,000 for the fund to stay on the state income tax return, it is imperative that physicians and others to donate whatever they can to this important endeavor.
Contact: Teresa Kline, 916/444-5532 or tkline@cmanet.org.
9. Benefit of the Week: 15% off Insurance Products
CMA members receive discounts on a variety of insurance products, including automobile, group health, life, long-term care, workers’ compensation, and more! Click here to find out how you can save up to 15 percent.
Click here for more information on your membership benefits.
Contact: CMA’s member help line, 800/786-4CMA or twilson@cmanet.org.
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