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1. New Budget Cuts Threaten Medi-Cal Provider
Rates The governor’s proposed cuts include: a 10 percent reduction in Medi-Cal provider rates; reinstatement of the Medi-Cal Quarterly Status Report, which would reduce eligibility for adults adding up to 250,000 people to the uninsured ranks; elimination of optional Medi-Cal benefits, such as adult dental care and medical supplies; and a rollback of Medi-Cal eligibility to include only those families with income at or below 61 percent of the federal poverty level—about $14,600 for a family of four—down from 100 percent. This would leave an additional 150,000 of the working poor without health insurance. Overall, Governor Davis’s plan would reduce Medi-Cal spending by $167.4 million. For every Medi-Cal dollar cut, California would also lose $1 in federal matching funds. Senator John Burton (D-San Francisco) said that there will be hearings to investigate whether the governor’s proposed cuts would actually save the state money. CMA leaders are ready to testify, telling legislators that the governor’s proposed health care cuts will add to the ranks of the uninsured and increase inappropriate use of emergency rooms. The cuts will also degrade the health of California’s workforce and will harm the state’s already fragile health care system. "Further reducing rates will force physicians to turn away patients in order to stay in business," says CMA President John Whitelaw, M.D. "In the long run, these cuts will actually cost the state money as more Californians will turn to emergency rooms for expensive care that could be delivered more efficiently elsewhere." The fact remains that without new revenue sources there is little hope of avoiding massive budget cuts. Assemblyman Dario Frommer (D-Los Angeles) will introduce legislation to raise tobacco taxes by $1.55 a pack, with the new revenue going to the health care system. Senator Gloria Romero (D-Los Angeles) will reintroduce a nickel-per-drink tax on alcohol, with the money going to emergency care. There will be many other proposals to raise taxes and earmark money for specific programs. With Republicans opposing any new taxes, none of these bills will pass unless the Democrats can win some Republican support in the two houses. CMA’s focus for the next couple of weeks will be to find sources of funding to protect Medi-Cal reimbursements. For previous developments in CMA's fight to preserve Medi-Cal funding, click here. Contact: Heather Campbell, 916/444-5532 or hcampbell@cmanet.org.
2. Cigna Settlement is Bad for Doctors and
Patients
The class action suit was filed in May 2000 to combat widespread and chronic abuses by HMOs. The case, which is being heard by Judge Federico Moreno in a federal court in Florida, alleges that the HMO defendants violated civil racketeering (RICO) laws by using coercive, unfair, and fraudulent means to control physician-patient relationships. In an attempt to avoid this class action suit, Cigna has engaged in a complex and questionable series of procedural maneuvers to settle another case being heard in an Illinois federal court. If the proposed settlement is accepted by the court, it would preclude most of the pending claims against Cigna in the RICO case, as well as any other state court actions. The Illinois case—which accuses CIGNA of bundling, downcoding, and arbitrarily denying claims—was brought by two physicians, who by virtue of class action laws represent all other Cigna physicians across the nation. By some estimates, each participating Cigna physician could receive as little as $30 in the settle-ment. To get additional payment for disputed claims, physicians would have to fill out individual forms for each claim and send them back to Cigna for adjudication. The settlement also forces Cigna to clearly disclose its payment policies, but does not require the plan to change those policies to fairly reimburse physicians in the future. CMA and 18 other state medical societies have condemned the proposed settlement. "An important part of what we’re fighting for is a long-term and significant change in the way these companies do business with the American people and their doctors," says Texas Medical Association president Fred Merian, M.D. "The Cigna settlement comes up short in many ways." For example, under the settlement Cigna would still be able to use financial criteria to overturn a treating physician’s decision about the medical appropriateness of a treatment, as long as the company discloses those criteria publicly. "Basically, they can still have their way with us; they just have to tell us what they’re going to do ahead of time," says CMA CEO Jack Lewin, M.D. The medical societies that collectively voiced their opposition to the Cigna settlement represent more than 200,000 physicians across the country. "The terms of this settlement are a giant step backward compared to the HMO reforms we can win through the antiracketeering lawsuit that now represents a certified class of more than 700,000 doctors," says Donald Timmerman, M.D., President of the Connecticut State Medical Society. Lawyers for the plaintiffs in the RICO case have petitioned Judge Moreno to block the Cigna settlement and order that the Illinois case be part of the class action suit that is being heard in his court. In their filings, the attorneys said that Cigna’s conduct "amounts to nothing less than a deliberate, calculated attempt to flout [the court’s] orders." The judge is expected to rule on that request by December 13. For more information on the RICO case, click here. Contact: Karen Nikos, 213/630-1139 or knikos@cmanet.org.
3.
CMA Asks AMA to Sue U.S. Over Medicare
Inaction The AMA board of trustees incorporated the CMA delegation’s resolutions into a more comprehensive report that calls for a multipronged effort to remedy the Medicare physician payment problem. Board of Trustees Report 24 also calls for the AMA to, among other things, take the following actions: send a written communication to every U. S. senator expressing physicians’ anger and frustration with the Senate’s failure to correct documented errors in physician payment; immediately distribute materials for display in physicians’ offices alerting patients and their families to an access-to-care meltdown as result of the U.S. Senate’s inaction; aggressively expand grassroots participation in the Medicare campaign through the use of blast fax, e-mails, and the toll-free grassroots hotline (800/833-6354); and assist state medical associations and state and national specialty societies and group practices in hosting "mini-internships" for our federal elected officials. Inviting members of Congress and their staffs to spend a day in a physician’s office will help them to understand the urgency of the physician payment problem. The report also calls for AMA to evaluate appropriate legal remedies to prevent Medicare payment cuts that threaten patient care. For more information on CMA's fight for a Medicare payment fix, click here. Contact: Dean Chalios, 916/444-5532 or dchalios@cmanet.org.
4. HIPAA Tip: Using Patient
Names Do you have other questions about HIPAA compliance?
To find a workshop near you, click here. To read previous HIPAA Tips, click here. Contact: CMA's HIPAA Hotline, 415/882-3311 or legalinfo@cmanet.org.
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