MedPartners begins reimbursing physicians
Bankrupt IPA makes $3.5 million payment
MedPartners has agreed to begin paying thousands of California physicians the more than $50 million it owes them for caring for patients from as long as a year ago, according to the California Medical Association (CMA) in San Francisco.
The agreement, facilitated by the CMA and California Gov. Gray Davis’ office, may resolve a key impasse in the MedPartners bankruptcy settlement negotiations.
Under the agreement, physicians with the oldest claims will receive partial payment of the claims until the total reaches $3.5 million. MedPartners says it may continue to make chronological payment of claims and release another $3.5 million within a few weeks.
Whether the bankrupt independent practice association will pay any further claims depends on whether California physicians return release forms that waives their right to sue MedPartners and the health plans that contracted with MedPartners.
MedPartners has mailed release forms to 6,000 California physicians, who have until Nov. 30 to return them.
The insurer will not disburse any money beyond the initial $3.5 to $7 million unless physicians whose claims represent at least 70% of the claims against MedPartners return the releases. Physicians who receive the initial payments and endorse the checks will be automatically agreeing to the terms of the release.
Association representatives have urged their physician members to sign the release, saying it represents their best chance to get paid.
"CMA and the Davis administration have spent an unprecedented amount of energy putting the MedPartners negotiations back on track. We are optimistic that the physicians will be paid and we can all begin to put the whole MedPartners debacle behind us," says Jack Lewin, MD, CMA executive vice president.
The CMA stepped in when the settlement agreement was in real danger of collapsing, Lewin says.
"Frankly, between squabbling by health plan and MedPartners attorneys and their persistent lack of resolve to conclude this process, the entire settlement agreement had languished," he adds.
In October, the CMA filed suit against eight HMOs, asking that they reimburse physicians for unpaid bills submitted to the health plans’ intermediaries that have gone out of business.
Named as defendants in the suit are: Aetna U.S. Healthcare, Blue Cross of California, Blue Shield of California, HealthNet, MaxiCare Health Plans, PacifiCare of California, Prudential Healthcare (recently merged with Aetna), and United Health Care of California.
The suit, filed in San Diego Superior Court, accused the HMOs of avoiding their responsibility to reimburse physicians who care for insured patients.
The suit came on the heels of a report by the CMA expressing concern that millions of Californians may face interruptions and delays in medical care because the state’s health care system is underfunded. The report cited statistics from a PriceWaterhouseCoopers report that predicted the collapse of at least 34 independent practice associations.
The CMA report cites the recent collapse of FPA Medical Management and MedPartners Provider Network, which led to disruption or delay in care for more than two million patients and left physicians with more than $100 million in unpaid bills for HMO patients.
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