OSTEOPATHS SAY 'UNION NO!' At its annual House of Delegates meeting last month in Chicago, members of the American Osteopathic Association voted down a physician unionization effort. The vote comes less than a month after their allopathic counterparts at the American Medical Association voted to form a union (see story on page 6). In a voice vote, the 340 delegates overwhelmingly rejected unions and pushed for direct negotiations between physicians and third-party payers to solve problems. They also expressed support for federal legislation loosening antitrust constraints that prevent private-practice physicians from unionizing.
"We recognize that it has become increasingly difficult for physicians to negotiate contracts," says John B. Crosby, AOA's executive director. "However, we believe that physicians and managed-care organizations can work together to create an open and constructive dialogue to benefit patients as well as improve the practice environment for osteopathic physicians."
CLASS DISMISSED. July brought both bad news and good news for PhyCor, the troubled Nashville, Tenn.-based physician practice management company.
The good news is that Tennessee's Chancery Court for the 20th Judicial District granted PhyCor's motion to dismiss a class-action suit brought last fall by shareholders and bond holders. The bad news is that New York law firm Stull, Stull & Brody announced it was bringing a class-action suit on behalf of PhyCor bondholders in federal district court in Tennessee. Another class-action suit involving PhyCor's shareholders is pending in the same federal court.
The state and federal lawsuits stem from troubles at PhyCor that started in July of last year when the company cut its earnings forecast for 1998 and stock plummeted more than 40%. In September of last year, the company said 1998 earnings would be about 25% below what they had predicted in July. At Modern Physician's press time, shares of PhyCor were trading at almost $6 per share.
PPOs UNDER SCRUTINY. The National Committee for Quality Assurance, the national health-plan watchdog, announced last month it will soon begin rating the quality of the nation's 1,035 preferred provider organizations. More than 89 million Americans are enrolled in PPOs, yet until now there has been no quality oversight of the loosely managed delivery systems.
The NCQA's evaluation of PPOs initially will be based on member surveys, which will be conducted later this year. But a more comprehensive PPO evaluation program is expected to be implemented sometime next year.
Many healthcare purchasers have decried the absence of any meaningful, comparative data on PPOs.
"This is an area where there has been a void. We believe that purchasers should be able to rely on a nationally recognized process that establishes reasonable standards of access, quality and customer service," says Robert Walton, a representative of the California Public Employees' Retirement System.
PATIENT RIGHTS. Voting along party lines, the Senate by a margin of 53 to 47 on July 15 passed the patient protection legislation favored by Republicans.
The legislation would increase access to emergency care and specialist services, extend stays for women undergoing breast cancer surgery and expand the rights of patients to appeal when their health plans deny care. The proposed law applies only to enrollees in self-insured plans.
The Republican legislation falls far short of what Senate Democrats and physician groups wanted, including giving patients the right to sue HMOs for malpractice. The American Medical Association, for example, wanted the Senate legislation include the right to independent appeals of health plan decisions and health-plan accountability for decisions that cause death or injury.
President Clinton has said he will veto the bill if it passes the House in its current form. Though House Republicans hold majority status, they are far from unified when it comes to patient rights.
NEW DOC-OWNED HOSPITAL. Just weeks after their peers across town announced the closing of Precedent Hospital (a 1-year-old physician-owned hospital), another group of Denver-area physicians announced plans to open their own, an outpatient surgical hospital.
A group of 25 surgeons have partnered with Nashville, Tenn.-based Ambulatory Research Centers to build a medical campus south of the city that will include the hospital and an office building. ARC will manage the hospital, but the physicians will retain control of operations. The physicians already have raised an estimated $2.5 million, according to James Lindberg, M.D., a physician investor and member of the future hospital's board of directors.
Unlike Precedent, which faced stiff competition in a crowded Denver market, the new Dry Creek Medical Campus hopes to partner with local hospitals and contract their outpatient surgery, Lindberg says.