ALERT re AB 889 (Frazier)                                                              

AB 889 has just passed the Assembly Floor vote victoriously. The next procedural stop for this bill is the state senate. This bill is unique in that it'll remove stepwise medication requirements for patients generally but will still leave room for the insurance companies to  impose stepwise prescribing for injured workers pursuant to SB 863. In other words, it will give benefits to patients who are privately insured or who are dependent upon HMOs, PPOs, and managed care that will not be made available to injured workers who will still be subject to stepwise prescribing by dint of SB 863 since they will remain subject to the whims of MPNs (Medical Provider Networks) empowered to make their own decisions and whose power under the law has been increased by last year's passage of SB 863. If AB 889 makes it through the Senate, it'll still be subject to Gubernatorial veto -- the Governor vetoed similar legislation  last year. Proponents of AB 889 need to start now to work the state senate and also the Governor's office. Some legislators who favor AB 889 are the same legislators who voted for SB 863 -- their votes now for AB 889 may be an act of contrition or a call of conscience. Either way it's a good start. Now we need the state senate  to come on board and for the legislature to convince Gov. Brown not to veto the bill if it passes the legislature.

Proponents of this legislation are currently reported to include groups as diverse as the California Medical Association, the Union of American Physicians and Dentists, and the American Federation of State, County and Municipal Employees. We expect that Assemblyman Frazier's website will reflect a larger list.

AB 1687 (FONG) DESERVES PASSAGE INTO LAW

SB 923 (DELEON) DESERVES DEFEAT   

UTILIZATION REVIEW particularly by companies owned, controlled, or supported by insurance companies has been recognized for escalations of cost associated with wrongful denials of treatment. Here's how it works:
1) Josephine Sheetrock gets injured on the job and receives authorized initial treatment from a Primary Treating Physician (PTP) who in turn belongs to a Medical Provider Network (MPN) with which her employer and insurance company have a contract to provide care for injured workers (IWs);
2) Josephine Sheetrock's treatment does not resolve the clinical problem so the PTP seeks authorization for specialty consultation;
3) The PTP's request for authorization for specialty consultation and/or diagnostic tests is denied;
4) An authorization denial letter couched in the language of formal Utilization Review is sent to the PTP (it tells the doc to peddle his papers elsewhere);
5) The formal language is derived from the American Medical Association's Guides to the Evaluation of Permanent Impairment, from the American College of Occupational and  Environmental Medicine (ACOEM), and from the current Medical Treatment Utilization Schedule (MTUS), all usually correctly quoted while being wrongly applied;
6) The PTP can file an appeal. It the PTP files appeals too often or too successfully, the PTP risks being dropped from the MPN;
7) The consequence is that formal appeals are often perfunctory, not made at all, and are often unsuccessful (Josephine Sheetrock goes without treatment and is obliged to "go legal," i.e., to retain an attorney who specializes in workers compensation).

*** HMOs, other managed care organizations, and Knox-Keene Plans use similar mechanisms to delay or deny care. Money that should be allocated to patient care is retained by insurance companies, cooperative Utilization Review companies, and for enhanced executive compensation. 

*** AB 1687 (Fong) which applies to workers comp should be passed into law. It will help level the playing field by requiring full disclosure for denied care and by increasing access by injured workers  to lawyers who specialize in workers compensation;

*** SB 923 (Deleon) which also applies to workers comp should be defeated because it will deprive PTPs and their patients from access to specialty care. 

References

See our postings for 1 June 2012, 21 May 2012, and previous postings re workers compensation in http://www.politicsofhealthcare.com

Totalcapitol.com

California Progress Report

San Francisco Chronicle, 8/29/08 ("How to practice medicine without a license")

These articles include reviews of previous attempts to require California state licensure for UR doctors and are available on line, e.g., concerning AB 2968 (Lieber),  AB 933 (Fong), and AB 584 (Fong).

HOW SB 923 WILL PROTECT INJURED WORKERS OUT OF THE HEALTHCARE THEY ALREADY HAVE

THE INJURED WORKERS WHO WILL BE HARMED MOST IF SB 923 (De Leon) becomes law are those whose jobs predispose them to serious injuries, e.g., construction workers and farmers, telephone repair workers, restaurant workers, freight handlers, even health care personnel (one health care worker was killed on the job in 2011) and other maintenance workers. SB 923 should bite the dust this year just as it did last year.

Ostensibly, the reason for SB 923 is to enable use of the Medicare RBRVS to pay for physicians' services to injured workers. The idea is to reduce payment to specialists so that payment to primary treating physicians (PTPs) can be increased. The proposed mechanism is to replace the current Office Medical Fee Schedule (OMFS) with the Medicare RBRVS.

But there's a catch. While SB 923 will reduce payment to specialists, it will not necessarily increase pay to the PTPs. In fact, the bill as currently written does not guarantee this outcome. In a personal letter by this writer to Daniel Crowley, Chairman and CEO of US HealthWorks, 6/24/2011, it was pointed out that SB 923 will cause specialists to withdraw from providing services to injured workers. Speaking to one of the committees that heard the bill last year, Stuart Bussey, MD, JD, president of the Union of American Physicians and Dentists, Local 206 of the American Federation of State, County and Municipal Employees (AFSCME, AFL-CIO) acknowledged that SB 923 might give PTPs a temporary "boost." Bussey also said that it would leave him, as a PTP, "holding the bag" for malpractice when he couldn't get specialists in timely fashion for seriously injured workers. Eventually, the UAPD went "neutral" or "watch" on the bill. The bill failed when a consortium of opponents teamed up to oppose it, an unlikely coalition led by the California Society of Industrial Medicine and Surgery (CSIMS).

Opposition to SB 923 also included the California Medical Association,  the California Orthopedic Association, the California Chiropractic Association, the California Neurology Society, the Interfaith Community of Los Angeles, the League of United Latin American Citizens, Voters Injured at Work, Latino Comp, La Raza Roundtable, and numerous individuals including injured workers who understood that the bill would protect them out of the healthcare protection they already had.

The Other Catch is how SB 923 is sponsored and how US Health Works gets paid. When USHW gets paid for providing care to injured workers, a portion of the money goes to the non-physician management company and to the investors who own the USHW clinics. Not all the money that the Medicare RBRVS conversion raises would go to the PTPs. Payment for management services is paid by the physicians, the PTPs. SB 923 as written doesn't preclude USHW from increasing its management fees to the PTPs. Once the doctors' group has received this  pay increase thanks to passage of SB 923 the next step will be to share it with the management group. Some pundits think that this factor is the real reason USHW executives are pushing for passage of SB 923.

Does the OMFS pay too much? The OMFS was set up in  1975 as a market-based mechanism (the Medicare RBRVS is not). Specialists are paid 5% less for specialty procedures now than they were in 1986. By contrast, the Evaluation and Management codes (E & M codes) for PTPs have been increased three times since 1986.

Unpredicted consequences of SB 923 are likely to include loss of Medical Provider Networks (MPNs) when the MPNs lose enough specialists such that they no longer meet the standards of the Labor Code pursuant to the reforms implemented during the Schwarzenegger years since 2004 and passage into law of SB 899. Some states such as Hawaii and Texas had to revise their Medicare-based fee schedules to bring the specialists back in -- thereby defeating the very purpose of having voted in the Medicare RBRVS. The anticipated reductions in pay to the specialists would be from 20 to 48% under SB 923 -- at that rate many specialists would be obliged to quit the program. Robbing Peter to pay Paul is not sound economic policy.

Conclusion: SB 923 qualifies for our "bite the dust" recommendation. The OMFS is already low cost. Updating it is recommended. Getting rid of it would endanger the provision of care to injured workers.