California
Managed Health Care Improvement Task Force |
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by
Dennis
O. Flatt
Have you seen the film, As Good As It Gets, with Jack Nicholson
and Helen Hunt? There is one scene in which a physician blasts HMOs.
Even screenwriters apparently realize that HMO-bashing has extraordinary
audience appeal.
This phenomenon is not lost on the Legislature, which
has its bill-producing machinery in high gear. In 1996, in response
to public outcry, legislation was enacted which called for the establishment
of an ad hoc task force that would study the impact of managed health
care in California. The task force, sometimes referred to as the "Richter
Commission," after the author of the legislation, commenced work
in mid-1997, and published its findings and recommendations in January
1998.
The task force consisted of 30 members, 20 of whom were
appointed by Governor Wilson. The Senate and Assembly appointed five
each. Membership consisted of broad representation of many interest
groups, including providers, consumers, labor, business and health insurance
carriers. Kaiser Permanente was represented by Steve Zatkin, Senior
Vice President, Government Relations, Program Offices. Alain Enthoven,
PhD, a respected economist from Stanford University, chaired the task
force.
In a relatively short period of time, the task force convened
and held a number of public meetings in various parts of the state.
Testimony was taken from interested parties, and written comments were
received from many interest groups.
The charge of the task force, in addition to studying
the impact of managed health care in California, included consideration
of appropriate placement and scope of regulatory oversight of HMOs and
other forms of managed care in this state. Currently, managed health
care plans (Knox-Keene plans) are regulated by the Department of Corporations
(DOC). A number of legislators and others have questioned whether regulation
by the DOC, given its other demands and interests, is appropriate given
the dramatic growth and market penetration of HMOs in this state.
Key Recommendations of the Task Force
The task force report includes in excess of 100 recommendations--too
many to describe in this article. Key recommendations include:
- A new state entity for regulation of managed health care should
be created to regulate health care service plans which are currently
regulated by the DOC, and to phase in the regulation of other entities
over time. Medical groups and other provider entities that bear
significant risk should be directly regulated by the new state entity
for solvency and quality. The new state entity should be either
a board or an individual, appointed by the governor, and confirmed
by the Senate.
- The new state entity should have several guiding principles, including
overseeing one periodic solvency audit and one quality audit, upon
the request of a provider group.
- Purchasers should offer choices of plans when possible.
- The California Public Employees Retirement System should conduct
projects to risk-adjust premiums in California, preferably with
the University of California, and the Pacific Group on Health.
- The Major Risk Medical Insurance Board should be directed to develop
and modify as appropriate, every two years, a set of five standard
reference coverage contracts for all product types in the small
and individual markets. Standard outlines and definitions for "evidence
of coverage" should be developed.
- State data collection should transition from one that is based
in statute, to a regulatory approach. The state should set broad
data guidelines, but give the state entity for regulation of managed
care the authority to approve data elements.
- Consistent, mandatory, complaint-process standards should be developed
with stakeholders and adopted for all health care service plans,
including application to provider groups, non-urgent and urgent
timing requirements, and periods of limitation.
- Health plan disclosure should be improved to include the scope
and general methods of incentives paid to provider groups and practitioners,
as well as specific methods paid or received upon request. The state
should prohibit capitation of individual practitioners for a substantial
portion of the cost of referrals for that practitioner's patients.
- Health plans, medical groups, and IPAs should be required to provide
continuity of care with providers for chronically ill, acutely ill
and pregnant patients when they involuntarily change plans, or when
a provider is terminated for other than cause, through the course
of treatment, up to a maximum of 90 days or safe transfer.
- Health plans should be required to allow extended, prolonged or
permanent referrals to specialists for enrollees with life-threatening,
degenerative or disabling conditions that require specialized care,
while maintaining coordination of services.
- Health plans should develop alternatives to prior authorization/concurrent
review, based on statistically valid patterns of care and outcomes,
or professional consensus. Providers with an exemplary practice
profile should care for patients with automatic plan approval for
a defined scope of practice.
- The new state entity for regulation of managed health care should
convene a clinical expert panel to determine best clinical practices
and standards of care, as well as when and how to reclassify therapies
from "experimental" to "proven" treatments.
- Purchasers should encourage plans to work toward credentialing
and certifying medical groups and providers based on their knowledge,
sensitivity, skills and cultural competence to serve vulnerable
populations.
- Women should be allowed direct access to their health care providers,
including reproductive health services, in a manner
that permits and encourages coordination of services.
- Leaders of California's academic medical centers should work together
to develop an authoritative projection of physician personnel (and
other health professionals) needs, and a plan for adjusting education
programs to meet them.
What will happen now?
As you would expect, legislators are hurrying to introduce
bills that will address specific recommendations adopted by the task
force. It is reasonable to expect that most if not all of the recommendations
of the task force will be included in one bill or another in 1998. This
does not mean, however, that Governor Wilson will look favorably on
all of these bills. As a matter of fact, the governor has indicated
that he will consider some of the recommendations, and not others.
From a political standpoint (and this may be the real
story this year), it should be remembered that 1998 is an election year
and managed care is a hot political "interest zone." Political
strategists are advising candidates of both parties to include health
care in their campaigns this year. HMOs are "fair game," and
the issues, real and imagined, will receive considerable attention as
we approach the June and November elections.
In 1998, expect the Legislature to send scores of anti-managed
care bills to the governor. He will veto many, but he cannot be expected
to veto all of them, particularly in an election year.
