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Read Making a Killing

home / healthcare / in the media

Associated Press
Aug 30, 1999

by John Howard

Newly Released List of Managed Care Complaints Stirs Debate

SACRAMENTO -- The findings are sure to spark a political firefight.

New state figures show that more than 23.5 million people are enrolled in California's managed health care plans, but only a scant few - a mere nine-thousandths of a single percent - formally complain about treatment.

California's official report of HMO complaints for 1998 offers potent ammunition to health care reformers as well as to the obscure agency that fields the complaints.

But both sides, usually sharply divided, agree one reason for the relatively low number of care-related complaints may be simple: Few people know who to call.

"How many people know that it's the Department of Corporations that regulates them? I must get 10 to 15 calls a day from patients, and they are completely unaware of the DOC. There's a basic lack of awareness there," said Andrew Pontious of the Santa Monica-based Foundation for Taxpayers and Consumer Rights.

The HMO industry's top lobbyist sees a silver lining in the new numbers, arguing that an "infinitesimal number of complaints" means HMOs are doing their jobs.

"I think everybody acknowledges in the industry that there are problems with managed care and that the industry has to respond. But these numbers suggest that the problems may not be anywhere near as great as the daily press reports in its drumbeat of horror stories," said Walter Zelman, head of the California Association of Health Plans.

The report, required by law, was compiled by the Department of Corporations, which regulates health care management organizations in California. Released without fanfare on the department's Internet web site, it covers Jan. 1 through Dec. 31, 1998, and lists two broad categories of complaints, called "referrals."

One type of referral describes non-emergency issues, such as paperwork snafus and problems with billing. When the state gets complaints like those, they typically are sent back to the HMO for handling.

The other, called "Referrals for Assistance," deals with a myriad of problems related to medical care: waits, treatment, the availability of specialists, coverage, the quality of care, medical denials, telephone help, physical therapy and followup appointments, among many others.

These referrals, called "RFAs," are the crux of the report. They mean a patient has tried without success to resolve the problem first with the HMO.

"We're the last resort," said Corporations Department spokeswoman Julie Stewart.

During 1998, there were a total of 2,154 verified RFAs at 56 HMOs enrolling 23.52 million people. These figures do not include separate tallies for dental, vision, psychological and specialty services.

The HMOs ranged from the mammoth Kaiser Foundation Health Plan, which has nearly a quarter of all Californians who belong to HMOs, to a small ones such as Greater Pacific HMO, Inc., which has 724 members.

The referrals are listed several ways.

First is the raw number of complaints. For example, there were 540 RFAs during 1998 involving Kaiser, which has 5.82 million enrollees. Prudential Health Care Plan of California, with 969,000 members, had 88 referrals.

Then, there is a description of the number of RFAs for every 10,000 enrollees, the most significant statistic in the report. This figure is intended to give a meaningful comparison between HMOs, despite their dramatic differences in size. Overall, the RFAs averaged fewer than 1 per 10,000 enrollees.

The RFAs are further broken down according to type. Generally, but not always, the RFAs involve primarily quality of care issues. These, too, are listed per 10,000 enrollees.

Of California's five largest HMOs in 1998 - Kaiser, Blue Cross of California, Health Net, Medpartners Provider Network and PacifiCare of California - the HMO with the highest incidence of referrals per 10,000 customers during 1998 was PacifiCare, with 1.7461, or nearly double the overall average.

Health Net showed 1.23 per 10,000, while Blue Cross had .9448 per 10,000 and Kaiser had .9268. Medpartners, selling off a bankrupt subsidiary in agreement this year with regulators, showed by far the lowest, .0181 per 10,000.

The Corporations Department says the survey should not be used as report card to grade HMOs, and it's easy to see why - the document includes only raw numbers. No differentiation is made between the severity of the RFAs, such as whether terminal illnesses were involved. There is no description of a particular HMO's legal or financial problems that could affect its track record, such as whether state regulators took action against it.

There are no names, no treatment histories, no details of the complaints or the medical cases that inspired the referrals, and all documents related to the Corporation Department's ultimate decision in the cases are, by law, kept secret.

That means the numbers carry no human dimension. There is no sense of a patient's agony, or the agony of the families. And it is the quality of those cases, not the quantity, that reform advocates say demonstrates the real need to overhaul HMO regulations.

The department has a 60-day limit to resolve complaints, but that deadline is elastic, depending largely on the complexity of the cases.

The decisions are made by medical consultants under contract to the department. The consultants, whose names are secret, recommend decisions to the commissioner of corporations, who has the final authority.

Even the decision is secret. Stewart said the department resolved more than 4,700 RFAs during the past year, a figure that included a hefty backlog, but whether they were decided in favor of the patient or the HMO is not available.

Pontious said the system is flawed, and it's the patient who suffers.

"The department has the authority to reprimand HMOs, but it really doesn't have the authority to take on the cases that should be taken on. That's why we want to take these to a court of law. The deck is stacked against the families and the patients and the victims. And a lot of people will just roll over and not pursue their complaints, because they have been brought up to trust their doctors," he said.


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