HIPAA SUITS. After surviving a review in the early days of the Bush administration, the HIPAA privacy regulations issued by the Clinton administration last year now are the targets of at least two lawsuits.
The South Carolina Medical Association and its affiliated Physicians Care Network, joined by the Louisiana State Medical Society and a half-dozen South Carolina physicians, are suing HHS and Secretary Tommy Thompson and challenging the constitutionality of the 1,500-page regulations. The plaintiffs filed their case July 16 in a Columbia, S.C., federal court.
On July 31, the Association of American Physicians and Surgeons, a conservative group based in Tucson, Ariz., announced that it would file its own federal suit in early August in Houston.
According to the South Carolina physicians, HIPAA Section 264 authorizes HHS to write privacy rules if Congress were unable to pass a privacy law within three years of the original law's passage. HIPAA was enacted in August 1996. This provision, they say, violates Article I, Section I of the Constitution, by delegating legislative power to make laws to the executive branch.
MEDICAID DRUG PLAN. Georgia last month became the first state in the nation to offer a preferred list of prescription drugs to Medicaid patients, with a sliding scale of co-payments based on the clinical effectiveness of the drug rather than cost. However, patients may be able to avoid the co-pay altogether because federal law may supersede the state rule, according to one expert.
A new regulatory initiative of the Georgia Department of Community Health, which took effect July 1, sets co-payments as low as 50 cents for pharmaceuticals on the preferred drug list. Medicaid patients are asked to pay up to $3 for drugs not on the list.
Though the cost may be a burden on low-income Medicaid enrollees, "The $3 co-pay is uncollectable anyway under federal law," which prohibits states from blocking access to Medicaid benefits based only on cost, says David Cook, general counsel of the Medical Association of Georgia.
However, the organization is not advocating that physicians tell their patients about their legal right to refuse to make a co-payment. "We believe that all patients should have some responsibility for their care," Cook says.
NO SALE. Emergency room physician manager EmCare, on the selling block for nearly two years, is no longer for sale because its financial fortunes have improved, company officials say, even though its ailing parent corporation seeks protection from creditors.
"For all practical purposes, we've been taken off the market," EmCare CEO Bill Sanger says.
EmCare owner Laidlaw, a Canadian firm primarily in the bus transportation business, filed for bankruptcy protection June 28 in both the United States and Canada and announced plans to reorganize as a U.S. company. The move did not affect any of Laidlaw's operating subsidiaries. For day-to-day business, "It will have zero impact on us," Sanger says.
UNITED SUED. The Connecticut State Medical Society added UnitedHealthcare to the list of plans it is suing.
The society initially sued several insurers, including Hartford, Conn.-based Aetna, in February.
Society officials allege that United, like the other plans, arbitrarily denies payments for care, denies care without proper explanations, arbitrarily downcodes claims and uses computerized programs to downcode claims.
UnitedHealthcare officials didn't return phone calls seeking comment.
The suit in February was filed against six plans in conjunction with the state attorney general, who also independently sued plans last year.
QUALITY PAYS. Citing marketplace demand, Blue Cross of California overhauled its provider bonus program and will reward 23,000 HMO network physicians based on performance rather than cost containment, as was the plan's previous practice.
The new incentive system awards medical groups with bonuses worth up to 10% of quarterly capitated payments for patient care. Base capitation rates will be unaffected.
Some 200 medical groups serve 2 million Blue Cross HMO enrollees in California.
The plan will determine precise bonus amounts for each group based on its score on regular patient satisfaction surveys and certain measures for preventive health and chronic disease management.
LAWSUITS POLL. Almost 90% of AMA members polled prefer an independent appeals panel to new lawsuits for resolving disputes over coverage, according to a study from the American Association of Health Plans.
AAHP officials commissioned a poll of 300 randomly selected AMA members. The poll, which was conducted by an outside firm and has a margin of error of plus or minus 5.7%, found that 87% of physicians prefer an independent appeals panel to new lawsuits for resolving disputes over coverage.
AMA officials called the poll a "smokescreen" and a "gimmick."