Ralph Nader, consumer advocate and corporate hornet, stung Kaiser Permanente last week by demanding that the state of California halt new enrollment at the HMO until Kaiser solves quality-of-care problems.
At a press conference in Berkeley, Calif., called by the Consumers for Quality Care, Nader released a six-page letter to the California Department of Corporations. He said Kaiser's planned reduction in nurse staffing poses "a direct threat to the health and safety of Kaiser patients and . . . warrants the immediate scrutiny and intervention of state health authorities."
Kaiser, in response, dubbed the letter "a disgraceful bid for publicity.
"A so-called `consumer advocacy' organization with close ties to the trial lawyers and the California Nurses Association has dredged up old news and inaccurate information," the company said in a prepared statement. It blamed the CNA for putting Nader up to the stunt.
The union, representing 7,500 nurses in Northern California, has been working without a contract since the end of January and called a one-day strike April 16. Kaiser said Nader's letter was all part of a "corporate campaign" to discredit its good name.
CNA spokesman Chuck Idelson said the nurses union had nothing to do with it: "Ralph Nader did this on his own with Consumers for Quality Care," a Los Angeles-based managed-care watchdog group.
Nader's letter revisits a litany of allegations made against Kaiser in recent years: reductions in nursing care, inappropriate bonuses to physicians who deny care, premature discharges of patients and new mothers, and abuse of binding arbitration.
He cites two recent incidents that have left Kaiser with a black eye in two states. In California, federal and state authorities have prepared a report on Kaiser hospitals in Richmond and Oakland. Several patients have died this year after seeking emergency care at Kaiser Richmond Medical Center, which does not have a fully functioning emergency room.
In Texas, the attorney general released a report alleging Kaiser failed to reimburse patients for appropriate emergency care and other improprieties. Kaiser agreed to pay a $1 million fine after taking legal steps for weeks to keep the report under wraps (April 28, p. 12).
Peter Kezirian, general counsel to the California Department of Corporations, said his office issued a critical report about Kaiser in July 1996 outlining a number of corrective actions. The health plan will be reviewed again this July to see whether the actions are in place and working.
The department can halt enrollments if it chooses, but it has a wide assortment of other enforcement actions in its quiver. It will pick the most appropriate remedy to address any problems it finds, Kezirian said.
In its response to Nader, Kaiser said the Texas insurance commissioner regarded the "vast majority" of the audit report as nothing more than "allegations." Kaiser said it concurred with certain findings concerning documentation and administration and emergency claim payments.
In California, Kaiser said it has acknowledged its responsibility to fix the problems in Richmond and Oakland in cooperation with the state Department of Health Services and HCFA. It's expecting a return visit soon from officials who will certify Kaiser has made the proper corrections.
Kaiser stressed it has just solidified its relationship with organized labor in a peace pact with the AFL-CIO and that it spends 96.5 cents of every premium dollar on healthcare for its enrollees, far more than the typical HMO (See story, p. 42).
Meanwhile, on April 29 Kaiser released a three-page summary of its corrective actions in the Richmond and Oakland hospitals. If authorities do not accept Kaiser's measures, those two hospitals would not be reimbursed for Medicare or Medicaid patients admitted after May 7.
The full report is expected to be made public this month.
Kaiser Chairman David Lawrence, M.D., said in a news conference April 24 that Kaiser is exploring a number of alternatives for the Richmond hospital, which is too underutilized to fully staff but too new to close down. "We are looking for a partner to come into Richmond and work with us and operate that hospital for the benefit of the community," Lawrence said.