Legislation that would move physicians into the driver's seat in controlling provider networks and newly developed managed-care plans is being proposed by the American Medical Association.
Doctors, rather than insurers or hospitals, know what's best for patients, and they know best how to contain healthcare costs, the physician trade group argues in justifying the model legislation.
The bill, known as the Physician Health Plans and Networks Act, would encourage the development of physician-controlled financing and delivery systems by eliminating a number of financial and regulatory hurdles.
"Entities with substantial capital and fewer legal restrictions, including large insurance companies, hospital holding companies and medical supply corporations, have a tremendous advantage (over physicians)," the AMA said in a statement accompanying the model legislation.
According to the AMA, physicians, physician groups and physician-hospital organizations combined own only 8.9% of all PPOs and 7.5% of all HMOs.
Not unexpectedly, the bill drew the label of special interest legislation from other industry sectors that traditionally have controlled provider networks and managed-care plans.
Karen Ignani, president of the Group Health Association of America, which represents managed-care groups, said the AMA proposal "goes in the opposite direction" of protection for patients by exempting physician-led plans from certain fraud and abuse laws and other consumer protection measures.
The legislation, for which the AMA is seeking sponsors, will be one of several managed-care initiatives to be debated at the AMA's interim annual meeting this week in Honolulu.
A copy of the legislation was obtained last week by MODERN HEALTHCARE. It would virtually eliminate all legal obstacles for physicians forming networks and managed-care plans.
The legislation would exempt physician-controlled networks and plans from "restrictive" securities, antitrust, tax and benefits, fraud and abuse, and self-referral laws.
On the financing front, the legislation would require the federal government to create a loan pool for the start-up of physician-controlled health plans. It would also require the government to pay the outstanding obligations of physician-sponsored plans to beneficiaries if the physician plan becomes insolvent.