Thursday, August 18, 2016

NOW COMES SB 1160 (Mendoza): Unreasonable Denials

SB 1160 (Mendoza) would require that lien claimants in workers comp file declarations with all liens as of 1 January 2017. Failure to follow through on this step would enable WCAB to dismiss the lien. As part of the signed declaration physicians would be obliged to say that the dispute in question is not subject to independent bill review. As we know from previous posts utilization review (UR) appointees  and independent medical reviewers (IMR) in California do not have to be licensed to practice in California, do not have to disclose their names, and are enabled by law to reject the most indicated and necessary treatment protocols . The situation is so dire that many treating physicians simply don't trust the utilization review or IMR process. In one recent post we disclosed how one UR doctor notified the injured worker's doctor about a denial of care at 10 PM while another notified the treating doctor's physician at 4:00 AM (nobody was home either time).

Carl Brakensiek, MBA, JD, Physician Advocate representing the California Neurology Society and the California Society of Industrial Medicine and Surgery, and others, has expressed concern "that some of the recently announced proposed amendments to SB 1160 will severely restrict access to care for many injured workers in California" and that certain "amendments being advanced by the Department of Industrial Relations will have a substantial adverse impact on many bona fide injured workers."

It was then pointed out that, fortunately, under the present system, because liens can be filed, there are physicians able and willing to provide medical care even though liability is being disputed. We call that a "Safety Net." It works because once proper liens are filed the providers of service get paid .

SB 1160 (Mendoza) throws all this past medical history out with the baby and the bathwater. It will require that liens for medical treatment be filed alongside declarations signed under penalty of perjury saying that the dispute isn't subject to independent medical review. Denial letters from adjusters or claims managers would no longer be automatically assumed to mean that "medical treatment has been neglected or unreasonably refused" and would allow employers to refuse coverage for injuries simply by asserting that the injury wasn't industrial. Brakensiek argues that this language should be revised "to specify clearly that if the employer has explicitly or constructively denied liability for the injury, then the claimant may file a lien."

Another likely blow to injured workers has to do with the assignment of liens. This technique is a financing modality useful when a number of liens have piled up over time because insurance companies, buttressed by Utilization Review, in turn buttressed by Independent Medical Review, have wrongly denied claims. The Lien Report from the Commission on Health and Safety Workers Compensation has already weighed in on this issue. Here is what was said: "we find no evidence that the practice of assigning lien rights is a problem in and of itself." By abolishing this mechanism, the Department of Industrial Relations now intends to make it a problem "in and of itself."

In a nutshell, prohibiting the assignment of liens would then become one more nail in the coffin of injured workers since many physicians now accepting liens would no longer be able to continue in practice. All in all we do not find that SB 1160 is helpful legislation in its current form. We find that amendments are needed. Therefore, at the present time, we urge an OUA (oppose unless amended) approach. 

Friday, August 12, 2016

AB 72 (Bonta): a pending bait and switch bill: Oppose Unless Amended

AB 72 (Bonta) is supposed to be consumer-friendly legislation since it'll do away with "surprise billing." The term, "surprise billing," refers to instances where patients, unable to secure medical services within their own network or managed care plan, are obliged to retain an out-of-network physician who then may charge usual and customary fees. The out-of-network physician is not bound by network rates because he has not contracted with the network. The "surprise" is to the patient who finds out (1) that he is not covered by the network to which he's been paying annual enrollment fees and (2) the out-of-network bill may be considerably more than one would have expected from an in-network provider. The patient caught in this trap has good cause to be angry.

AB 72 is supposed to "cap" out-of-network provider billings. The technique is also a "surprise" because in the guise of protecting patients it actually harms them while bolstering the profiteering mantra of the insurance industry. It is called "in-network cost sharing."

Susan Hansen, MD, neurologist, Mountain View, states that "AB 72 is a rate-setting bill that will devastate physicians ... by setting rates at 125% of Medicare." Hansen points out that no plan is likely to contract for a higher rate than the ceiling set by legislation and that "this bill removes the last chair in the musical chair game that price-fixing has caused" because "Medi-Cal, Medicare, and WC (workers comp) fees are typically set below the cost of doing business." Hansen then points out that this mechanism "forces physicians to cost-shift to the PPO and uninsured patients."

The tricky-dick part of AB 72 is that it actually forces all physicians to become de facto members of provider networks. Once this squeeze has been foisted onto the doctors, the door will be wide open for networks to increase executive compensation and corporate profit since they will now save money by underpaying physicians. Patients should soon realize that their premiums are being used to reward administrators, not the physicians and surgeons for whom they thought they were contracting. AB 72 is a fancy version of bait and switch. 

The trouble is that this "in-network sharing" model will  create understaffed networks -- that's how patients will suffer. Understaffed networks means fewer and fewer available physicians and surgeons -- the money moguls will have succeeded in putting profits before patients. AB 72 will be the tool. 

Eileen Natuzzi, MD, surgeon, San Diego, puts it this way: "... this mess was created by insurance companies and plans underpaying doctors, not doctors billing too much."

How to take action: We  expect this bill to go to the State Senate on or about August 16th. Next it's scheduled for the Assembly. Our recommendation is OPPOSE UNLESS AMENDED.

Here is a proposed amendment:  "health-care plans should be required to maintain full provider lists covering all specialties. The plans should provide these lists to their in-network providers and to all of their subscribers and customers.  Networks that fail in this requirement should be penalized by fines and disciplinary action against their managers and officers."