N.Y. HMOS SUBPOENAED. The New York attorney general is investigating five HMOs for violations of the state's patient protection law.
The attorney general is probing whether the HMOs illegally told patients they must get approval from their primary-care physician before seeking emergency treatment. If so, it is a violation of the "prudent layperson" standard of New York's 1996 patient protection law. The standard mandates that health plans cover treatment for services any prudent layperson would consider an emergency.
The five HMOs under investigation are Blue Cross and Blue Shield of Utica/Watertown, Cigna HealthCare, Kaiser Permanente's Northeast health plan, North AmeriCare and Oxford Health Plans. According to a spokesman for the attorney general, the health plans' marketing and membership materials were subpoenaed last month following complaints to the state's hot line by consumers, advocacy organizations and others.
SPECIALTY PPMS BUY PRACTICES. Two Florida-based physician practice management companies -- Pediatrix Medical Group and AmeriPath -- acquired medical group assets in May.
Pediatrix, based in Fort Lauderdale, Fla., on May 6 added six neonatologists in Chattanooga, Tenn., then on May 13 added 10 perinatologists in Phoenix and two perinatologists in Harrisburg, Pa. The acquisitions increased Pediatrix's representation to 390 physicians.
Meanwhile, Riviera Beach, Fla.-based AmeriPath, which represents 250 physicians, added a Hialeah, Fla.-based pathology practice on May 6.
The prices of the acquisitions were not disclosed.
MCKESSON HBOC COUNTS WRONG. McKesson HBOC on May 25 for the second time said it would have to restate earnings and revenues downward because of mistakes found in accounting for software sales.
The problems were announced April 28, six days after McKesson HBOC stated earnings for its fourth quarter, which ended March 31.
The company said software sales of $44.2 million for that year, including $26.2 million in the fourth quarter, were counted even though they weren't actually sold. McKesson HBOC says the sales were subject to "contingencies."
On May 25, the company said that after further review, the sales revisions would be even greater than expected, although it didn't say how much.
The company also said past annual earnings for HBO & Co., which merged with McKesson Corp. in January, may need to be restated.
DOCTORS SALARIES FALL AGAIN. Median net income for doctors dropped for the fourth consecutive year in 1997, according to the American Medical Association.
The AMA's 1998 Socioeconomic Monitoring System physician survey found that the median physician net income in 1997 was $164,000, down 1.2% from $166,000 in 1996. The average salary for physicians increased slightly in 1997, however. It reached $199,600, up from $199,000 in 1996.
Adjusted for inflation, median salaries were 3.4% lower. Between 1993 and 1997, median net income adjusted for inflation fell an average of 1.4% per year, and in 1995 and 1997 unadjusted median net income actually declined, the AMA said.
The survey also found that in 1997, 62.3% of physicians were self-employed; 36.1% were employees; and 1.6% were independent contractors.
HARD TIMES FOR INTEGRATED HEALTHCARE. It's been a rough ride for integrated health systems in recent years, and the future doesn't look any brighter, according to Lisa Goldstein, vice president and senior credit officer of Moody's Investors Service in New York.
Moody's, which rates organizations' ability and willingness to pay off debt, downgraded a record number of healthcare organizations in 1998 and the first quarter of 1999.
Expect higher-rated organizations in particular to see downgrades, Goldstein said last month at a national meeting of integrated delivery systems. She predicted more downgrades as a result of the 1997 Balanced Budget Act's negative impact on Medicare reimbursements. She also noted that greater revenue pressures from HMOs and a decline in the country's economic health could cause more downgrades.
DOCS CAN'T UNIONIZE. The National Labor Relations Board in Philadelphia ruled late last month that a group of private practice physicians from New Jersey could not be represented by a local union in their negotiations with AmeriHealth of New Jersey, a large HMO.
The 652 physicians from Atlantic and Cape May counties first sought the right to join the Newark, N.J.-based United Food and Commercial Workers Local in 1997.
The physicians argue that managed care so restricts their autonomy that they have become de facto employees of the HMO and should be able to collectively bargain. The NLRB in Philadelphia acknowledged that a complex relationship exists between the HMO and private practice physicians, but it noted that the physicians retain their economic separateness from AmeriHealth.