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1. Physician Incomes Falling
The average physician’s income dropped by $13,000 between 1995 and 2003, because of cuts in payments from Medicare and private insurance providers, according to a study released last week by the Center for Studying Health System Change (HSC).
Physicians earned 7 percent less, after adjusting for inflation, during 2003 than they did in 1995, according to HSC, a nonpartisan policy research organization in Washington, D.C. The decline in physicians’ real income stands in sharp contrast to wage trends for other professionals who saw about a 7 percent increase during that same time period.
Among different types of physicians, primary care physicians fared the worst with a 10.2 percent decline between 1995 and 2003, while surgeons’ income declined by 8.2 percent. But medical specialists’ income essentially remained unchanged.
The study also found that the average number of hours worked by physicians fell slightly from 55.5 hours a week in 1995 to 53.2 hours in 2003. This includes time spent on administrative tasks, professional activities, and direct patient care, but not time spent on call when not actually caring for patients. Physicians are also spending more time on direct patient care. With patient care hours increasing and total work hours falling, physicians are now spending a significantly larger proportion of their work time caring for patients, 86 percent in 2003 compared to 81 percent in 1995.
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2. Fluzone Orders May Be Canceled if Not Confirmed;
Deadline to Confirm Vaccine Orders Is July 14
Physicians who prebooked Fluzone vaccine for the 2006-2007 flu season should have recently received a notice from Sanofi Pasteur requesting confirmation of their orders. You must confirm your order no later than July 14. If you fail to do so, Sanofi Pasteur may cancel your order.
The confirmation notice would have arrived by e-mail or fax, depending on the communication method you marked as preferred when you placed your order. Orders can be confirmed online at http://www.vaccineshoppe.com or by calling 800/VACCINE.
Click here for more information.
Contact: Robin Flagg, 415/882-5110 or rflagg@cmanet.org.
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3. Appeals Court Says Physicians Must Be Protected from Retaliatory Lawsuits
Siding with a CMA brief, the 4th District Court of Appeals in San Diego recently dismissed the case against Michael Fitzgibbons, M.D., who was being sued for slander for speaking out about the bleak finances of Integrated Healthcare Holdings, Inc. (IHHI), the company that had purchased Western Medical Center in Santa Ana, where he served as chief of staff. The court ruled that the lawsuit should be dismissed under the state’s anti-SLAPP (Strategic Lawsuits Against Public Participation) law, which prevents use of the legal system to silence critics.
In 2004, IHHI purchased Western Medical Center and three other hospitals from Tenet Healthcare Corp. When in May 2005 IHHI defaulted on the two loans that it had taken out to fund the acquisitions, Dr. Fitzgibbons sent to other physicians on staff at the hospital an e-mail expressing doubt about the financial viability of IHHI. Most of the information in his e-mail came from an article in the Orange County Register that reported on IHHI’s financial troubles.
Citing the e-mail, IHHI sued Dr. Fitzgibbons for (1) defamation, (2) intentional interference with a contractual relationship, (3) negligent interference with a contractual relationship, (4) breach of contract, (5) breach of the duty of good faith and fair dealing, and (6) violation of the California unfair business practices statutes.
Dr. Fitzgibbons had asked the trial court judge to dismiss the complaint against him, citing the anti-SLAPP law. Although the trial judge denied the motion, the ruling was overturned on appeal.
The appellate court’s ruling is an unqualified victory not only for Dr. Fitzgibbons, but also for physicians everywhere. The ruling states with great clarity that speaking out on a matter of public interest, such as the financial solvency of a four-hospital system, is protected by California’s anti-SLAPP statute, says CMA attorney Greg Abrams.
CMA filed an amicus brief in this case, arguing that physicians must be allowed to express their opinions on matters affecting the health care of their patients without fear that such expression will subject them to an unfounded lawsuit. “This ruling reminds the health care community that the law strongly supports physicians in their role as advocates and protectors of health care for their patients and the community in general,” says Abrams.
Dr. Fitzgibbons was represented by Pasadena attorney Tom Curtis of BondCurtis, LLP, the same attorney who successfully represented the medical staff at Ventura’s Community Memorial Hospital in its medical staff self-governance battle against the hospital board several years ago.
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Contact: CMA’s legal information line, 415/882-5144 or legalinfo@cmanet.org.
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4. Federal Judge Dismisses CMA’s RICO Suit
Against UnitedHealth and Coventry
A federal judge this week dismissed CMA’s RICO lawsuit against UnitedHealthcare and Coventry Health. In a summary judgment, U.S. District Judge Federico Moreno said that while the court does not condone the health plans actions, CMA and the other plaintiffs had not presented sufficient evidence that the plans had conspired with the other health plan defendants to underpay physicians. These were the last remaining defendants in CMA’s seven-year racketeering case. Judge Moreno in January granted summary judgment for PacifiCare, another of the defendants in this case.
CMA’s attorneys said they would appeal the ruling. The dismissal has no effect on the settlements with the other seven defendants.
“This is devastating news to all of the signatory state plaintiffs, because United Healthcare in particular has been a very difficult and obtuse performer in the marketplace for physicians,” says CMA CEO Jack Lewin, M.D. “But this ruling does not distract in any way from what we have already achieved with the seven health plans that settled.”
Judge Moreno in his ruling said that no reasonable juror could conclude that UnitedHealth and Coventry conspired with the other health plan defendants to unfairly downcode and bundle physicians’ claims. “Needless to say, we vehemently disagree with Judge Moreno,” says CMA General Counsel Catherine Hanson. “There is no way one managed care plan alone could have gotten away with the unfair payment system perpetrated by this industry on physicians. Had there been one corrupt payor, physicians would have simply terminated their contracts with that payor.”
Seven of the 10 HMO defendants in the case had previously settled and agreed to pay a combined $585 million in monetary damages—with about two thirds going directly to physicians. But of even greater value are the binding commitments by these companies to provide an unprecedented level of transparency and fairness in their future payment practices and other business dealings with physicians for a minimum of four years. These prospective commitments have been valued far in excess of the monetary relief—at well over $1 billion.
The settling health plans also funded with more than $100 million two physicians’ foundations that will support ongoing study and research to benefit physicians and physician practices nationwide. In addition, money from the Prudential settlement will fund the Physicians’ Advocacy Institute, a national nonprofit organization that fights managed care abuse.
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Contact: CMA’s legal information line, 415/882-5144 or legalinfo@cmanet.org.
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5. New Medi-Cal Citizenship Regulations Not
Likely to Be Ready for July 1 Implementation
A federal law becomes effective on July 1 requiring Medicaid enrollees and applicants to show proof of citizenship and identification to obtain benefits, but it is unlikely that counties, which administer the program, will be ready to implement the new requirements by that date, state and many county officials report.
Although the law was passed in February, it wasn't until June 9 that the federal Centers for Medicare & Medicaid Services (CMS) provided guidance to states on how the new law should be implemented. The law requires that Medicaid enrollees show proof of citizenship or legal residency status to enroll or continue to receive benefits. Because CMS was so late in providing its guidance, state officials have had little time to digest the new law and create a workable plan of action.
State officials say they are working as quickly as possible to implement the changes, but they have concerns about how the new law might impact the 6.8 million Medi-Cal recipients in California.
"California is moving forward with implementing this new law, and we're taking the necessary steps to ensure a full and responsible implementation," said Ken August, spokesman for the California Department of Health Services. "We will soon be working with counties and stakeholders to craft instructions to implement the law. These instructions should be issued in August."
CMA is concerned that many United States citizens applying for Medi-Cal will not have these documents in hand (or even at all). According to some estimates, as many as 3.2 to 4.6 million citizens may lose their Medicaid coverage because they cannot produce the necessary documentation. Of particular concern are those Medi-Cal beneficiaries in nursing homes, many of whom are disabled or incompetent.
Implementing the federal law in California also depends upon the passage of legislation that implements the state budget. Once state law is passed, the state, working with counties and stakeholders, will move quickly to issue instructions to counties on how to implement the new requirements.
After the state law is implemented, people who declare that they are citizens and are applying for Medi-Cal for the first time will need to produce documents showing they are United States citizens before they are able to receive benefits.
Current beneficiaries will need to provide documentation at the time of their annual redetermination. Renewing beneficiaries will not be denied benefits if they cannot immediately provide documentation, as long as they make a good faith effort to get the documents, state officials say. During this time, physicians will be reimbursed for services provided to these patients.
Physicians are advised to use point-of-service (POS) swipe card systems to verify a patient's eligibility. If the screen shows the patient is eligible, the state will pay for services provided to that patient. Physicians should print out the screen and keep a copy of the eligibility verification in the patient's chart.
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Contact: Robin Flagg, 415-882-5110 or rflagg@cmanet.org.
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6. Law That Prohibits Mercury-Containing Vaccines for
Young Children and Pregnant Women Takes Effect July 1
Effective July 1, it will be against California law to administer mercury-containing vaccines—including inactivated influenza vaccine from multidose vials—to pregnant women and children younger than 3 years of age. Multidose vials of flu vaccine are made with thimerosal, a mercury-containing preservative.
Beginning this flu season, only doses of influenza vaccine from single-dose syringes or vials with trace levels (less than 0.5 mcg of mercury per 0.5-ml dose for pregnant women, less than .25 mcg per .5-ml dose for small children) or no mercury may be given to pregnant women and children under 3.
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Contact: Robin Flagg, 415/882-5110 or rflagg@cmanet.org.
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7. Deadline to Resubmit Aetna Add-On Claims Is July 14
Don’t miss your opportunity to submit unpaid “add-on” claims to Aetna for adjudication. The deadline to submit claims is July 14.
As reported previously in Alert, Aetna had been denying claims with add-on codes for CAD mammography (CPT codes 76082 and 76083) and myocardial perfusion testing (CPT codes 78478 and 78480), in violation of its RICO settlement agreement. Some physicians even stopped filing claims because Aetna was not paying them. A number of physicians filed RICO settlement compliance disputes and, as a result, in 2005 Aetna began paying for these add-on codes.
CMA and the physicians who filed compliance disputes continued to push Aetna to retroactively pay the previously denied claims for add-on codes. As a result of the compliance disputes and CMA’s ongoing RICO settlement enforcement, Aetna agreed in April to retroactively pay claims with add-on codes for CAD mammography and myocardial perfusion testing with dates of service on or after January 1, 2004.
The money involved is not insignificant. The 19 physicians and physician groups who filed compliance disputes were paid a combined total of $678,000, with one group receiving over $250,000.
The process for resubmitting previously denied claims is described on Aetna’s provider website. Click on “Add-On Code Claims Payment” in the “Features” section in the lower right corner of the top web page. Physicians should submit new claims following standard billing procedures.
More details are available from Aetna’s provider service center (888/632-3862 for PPO plans or 800/624-0756 for HMO plans). Have your tax ID number available when you call.
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Contact: CMA’s legal information line, 415/882-5144 or legalinfo@cmanet.org.
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8. Honor CMA On Its 150th Birthday:
Publish a Tribute in CMA’s Commemorative Book
To honor 150 years of “helping physicians help patients,” CMA is producing a commemorative book.
In this CMA anniversary book, we offer you the opportunity to pay tribute to your CMA in the way you see fit. You can honor fellow members, county societies, health leaders, health care achievements, and even your family and friends. This glossy, handsome commemorative book will be distributed to CMA’s members and beyond. Please join us in celebrating this major milestone in our history.
Don’t know anything about graphic design? Don’t worry—we can do it for you. All we need you to provide are the pictures and text that you want to have in your tribute.
Click here for more information.
Contact: 888/231-7451 or advertising@cmanet.org.
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 9. 150th Anniversary Trivia: Did You Know?
Did you know that in April 1931, the CMA House of Delegates established a Cancer Commission to represent physicians in the fight against cancer?
The commission was formed with the following goals in mind—to educate the medical profession in the early diagnosis of cancer; to develop facilities for the diagnosis and treatment of cancer patients; and to encourage research into the nature, cause, behavior, and treatment of cancer.
The commission went on to form important policies and in 1947 gave a significant grant to the fledgling California Cancer Tumor Registry, which is now the second largest tissue registry in the world and located at Loma Linda University Medical Center.
CMA is celebrating its 150th birthday! Visit http://www.cmanet.org/150 for other interesting information about CMA history.
Contact: Karen Nikos, 916/444-5532 or knikos@cmanet.org.
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10. Member Benefit of the Week: Avis Car Rental
CMA members receive up to 15 percent off daily, weekend, weekly, and monthly rates from Avis. Just use CMA's
Avis Worldwide Discount (AWD) number
when you make your reservation and you will automatically receive the CMA member discount.
When making a reservation online, make sure to select “check lowest rate” (not “check my corporate rate”) and input the AWD number where indicated. This will ensure you get the absolute lowest price available. Members can also log on to CMA’s
members-only website, and use the specially coded link to automatically receive the member discount. By following that link, you will also be able to print out special coupons that can be used with your CMA discount for even greater savings.
Make reservations online at
http://www.avis.com or call 800/831-8000.
Click here for more details about CMA member benefits and discounts.
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No. 2056 
