Each month, this page features selected short items about state health-care policy digested from newspapers around the country.
Clip File
October 31, 1997
Federal officials may enforce Kennedy- Kassebaum in California if state fails to take action soon
SACRAMENTO, CA—Federal officials may soon be stepping in to enforce the Kennedy-Kassebaum law in California, in the absence of state action on the law’s mandates. Democratic lawmakers in the state have been trying to push through legislation which expands on the federal law, while the Republican governor, Pete Wilson, has proposed more basic legislation.
If the federal government steps in, California residents will wind up with fewer and potentially more costly insurance options, Clinton administration officials say.
California, Missouri and Rhode Island are the only states that have abandoned efforts to pass enforcement legislation this year for those who need individual insurance. One or two others could join the list if their legislatures adjourn without completing action on pending measures.
Sen. Herschell Rosenthal (D-Los Angeles), who chairs the Senate Insurance Committee, said the governor’s proposal would cover only 10,000 or 20,000 people. Democrats want to pass a law that covers more people.
Gov. Wilson’s bill would have made individual insurance available only to people who had been insured for the previous 18 months and had exhausted their COBRA benefits. Democratic lawmakers wanted to go well beyond the minimum requirements of portability with legislation that would have expanded access to insurance even for people who had not been insured before. The lawmakers’ proposal would have capped the price of individual policies at no more than 20% above the average cost of such policies. Under Gov. Wilson’s bill, the cost of individual policies could not exceed the cost of policies offered through the state’s high-risk program.
Los Angeles Times, Oct. 12, 1997
NJ to license chinese-trained acupuncturists
NEWARK, NJ—New Jersey regulators have decided to license Chinese-trained acupuncturists who graduated from a list of 20 schools approved by China’s government and licensing officials in California.
The State Board of Acupuncture Examiners’ action was taken in response to a growing Asian community’s demand for services and for the right of trained practitioners to obtain a license.
Regulators have not yet considered what to do with applicants for licenses trained in Korea, Japan and other countries where acupuncture is also widely practiced.
Record, Bergen County, NJ, Sept. 17, 1997
NY passes law requiring managed care plans
to pay providers’ bills within 45 days
ALBANY, NY—A law requiring managed care organizations and insurance companies to pay their bills from providers within 45 days or face fines and interest penalties was signed by Gov. George Pataki on Sept. 26.
The law was prompted by complaints from doctors and hospitals about overdue payments and cash flow problems. "We will not allow any HMO or insurance company to undermine the stability of New York state’s health care system," Gov. Pataki said.
Under the new law, which takes effect in 120 days, companies can be fined up to $500 per day for each claim not paid within the required period. Total penalties cannot exceed $10,000 per company, though the limit would be expanded to $50,000 for persistent violators.
Times Union, Albany, NY, Sept. 27, 1997
NJ plans agree to pay claims within 60 days
TRENTON, NJ—New Jersey’s 10 largest health-maintenance organizations have signed an agreement with the state that requires them to pay doctors and hospitals within 60 days after a claim is filed—or pay interest of 10% annually.
Brokered by the state departments of health and insurance, the agreement will be followed shortly by regulations to make it applicable to every HMO in New Jersey.
The president of the medical society said "$50 million to $100 million is a conservative estimate" of the payments from HMOs "vastly overdue" to physicians. With more than half of New Jersey’s doctors in solo practice, state officials were concerned delayed payments could cause immediate cash flow problems.
The agreement applies to all clean claims. If the HMO disputes a claim, it must notify the doctor or hospital within 45 days.
In July, the state of New York forced Oxford Health Plan to pay retroactive interest of $1 million to doctors and hospitals in the state for delayed payments of bills.
Record, Bergen County, NJ, Sept. 27, 1997
United Hospital Fund volunteers to manage endowment from Empire Blue Cross conversion
ALBANY, NY—United Hospital Fund of New York City proposed taking control of the $100 million charitable fund that would be created by Empire Blue Cross and Blue Shield’s proposed conversion to for-profit status. Jim R. Tallon, Jr., president of United Hospital Fund, made the proposal at one of the hearings being held across the state to consider the insurer’s plans to convert to a for-profit insurance company.
Mr. Tallon said the charitable endowment would be preserved over time by his group’s investment expertise. He said start-up costs and administrative expenses also would be minimized if his group assumed control of the funds.
Empire officials made no response at the hearing to the proposal, but several advocacy groups said there may be some merit to it.
Times Union, Albany, NY, Sept. 17, 1997
Georgia could lose many of its rural hospitals
ATLANTA, GA—A rural hospital crisis in Georgia could lead to 20 to 40 hospitals closing over the next two or three years, experts predict. More than 50 of Georgia’s hospitals, most of them rural, lost money in 1995, the last year for which data are available.
Among the factors to blame are consolidation in the marketplace, the growth of managed care and a certificate-of-need process that prevents some hospitals from providing services that keep them competitive. With physician practices being bought up by dominant regional hospitals, some rural hospitals are being left without patients.
The legislature has failed to repeal the certificate-of-need process in recent years. While the repeal is seen as beneficial for community hospitals, an alliance of nonprofit hospitals has argued against repeal before resolving indigent care and medical training issues.
However, another law that was passed by the legislature to put in safeguards against hospital acquisitions may prove to be an obstacle to struggling rural hospitals that want to sell out to keep their doors open. The law requires fees of as much as $100,000 to be paid to the state attorney general and establishes regulatory hoops that could delay acquisitions.
Atlanta Constitution Journal, Sept. 21, Oct. 5, 1997
Another charity-care crisis looms in New Jersey
NEWARK, NJ—Fearing a repeat of last year’s charity care crisis, hospital officials and advocates for the poor criticized New Jersey’s governor and her opponent in the gubernatorial race for not proposing new ways to finance this care. Funding for the program runs out Dec. 31. Last year, last-minute efforts to patch together a funding plan left hospitals without reimbursement for months.
A spokesman for gubernatorial candidate Jim McGreevey said the Democrat has made proposals such as redirecting charity-care funding toward clinics that would focus on preventive care.
The comments were made at a forum sponsored by the Newark Municipal Council Health Care Committee. Charity care in New Jersey is currently funded by a mix of unemployment reserve funds and the general budget. One representative for the United Labor Agency suggested taxing employers who fail to provide health insurance for their employers.
The Record, Bergen County, NJ, Sept. 23, 1997
Tennessee marketing representatives convicted
for TennCare enrollment fraud
MEMPHIS,TN—Two marketing representatives for OmniCare Health Plan were convicted on charges of mail fraud, false use of Social Security numbers and conspiracy in the largest fraud loss in the TennCare’s history. In all, some $1.8 million in excess payments were made to OmniCare as a result of fraudulent enrollments.
James Crittenden and Shirley Moore Chapman enrolled about 500 nonexistent patients using the address of a Memphis homeless shelter on forms. The two netted a commission of $13-15 for each enrollment and the state paid OmniCare about $118 per month for each enrollee. OmniCare which told federal authorities it was not aware of the scam, settled with the state for the payments which were made from May to November 1994.
The Commercial Appeal, Sept. 16, 1997
PA lawmakers consider requiring fertility coverage
HARRISBURG, PA—When a lawmaker threatened to find a higher-paying job if the state didn’t offer fertility coverage, the House committee that oversees employee health coverage obliged.
While maintaining that its timing with the representative’s demands was a coincidence, the committee has agreed to pay an estimated $60,000 to $65,000 for the coverage.
Now, other lawmakers have stepped forward to sponsor legislation that would mandate that all insurers in Pennsylvania cover such procedures as in-vitro fertilization, artificial insemination and other infertility treatments.
"It’s hypocritical of me not to propose legislation to help other couples when I’m getting this," said Rep. Lisa Boscola, one of the representatives pushing the legislation.
Twelve states already require coverage for fertility treatments in varying degrees, according to the American Society for Reproductive Medicine in Birmingham, Ala. A survey of large-group plans by the Alan Guttmacher Institute in New York City found that only about 14% of those plans covered in-vitro fertilization.
Inquirer, Philadelphia, PA, Sept. 17, 1997
Minnesota doctors wouldn’t recommend HMOs
to family members, survey says
ST. PAUL, MN—A large majority of Minnesotans express satisfaction with their managed care plans in consumer surveys, but their physicians apparently don’t feel the same way. According to a recent University of Minnesota study, when physicians were asked whether they agree with the statement: "I would recommend this plan to a member of my family," a majority of respondents were neutral or disagreed. One exception was the health plan, HealthPartners,
Interestingly, 95% of HealthPartners Classic doctors, who get paid a straight salary, said they would recommend their HMO to family members. They are offered no incentives and typically make medical decisions independent of HealthPartners.
Another HealthPartners plan, Network, pays doctors a set amount per member and lets them keep what they don’t spend on patient care. Of the doctors in that plan, only 62% would recommend it to their family.The other plans—Medica Premier, Preferred One and Blue Plus—pay doctors for each service they perform and they have financial incentives to offer care that saves money. Only 40-50% of doctors in those plans said they would recommend them to family members.
"Members clearly prefer wider open networks and more choice," said Jan Malcolm, system vice-president for public affairs for Allina Health System, Medica’s parent company. "Yet this survey seems to say the physicians like the more restrictive model. This is a new angle on perceptions that has been understudied."
About 1,200 physicians in Twin Cities’ largest health organizations—HealthPartners, Medica, Preferred One and Blue Plus—were surveyed in December 1996 and January 1997. Researchers surveyed 300 physicians from each of the four plans.
While premium costs differ by only 6% among the plans, ratings by doctors vary by as much as 50 percentage points.
Executives from Medica, Preferred One and Blue Plus cautioned against drawing conclusions from the study and said it would be premature to use the results in report card fashion.
St. Paul Pioneer Press, St. Paul, MN, Sept. 17, 1997
Each month, this page features selected short items about state health-care policy digested from newspapers around the country.
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