Paying The Bills
Mission IPA battle gets to the heart of what works and what doesn't in managed health care.
Thursday, March 18, 1999
The battle over managed health care in Monterey County has turned ugly, involving lawsuits and charges of patient-grabbing, lying, refusing to pay bills and double-dealing.
At the heart of the battle stands Mission IPA, an independent physicians'' association (IPA) formed five years ago with the declared goal of giving doctors in solo practice or small groups better bargaining power when negotiating contracts with health plans'' HMOs. Mission IPA acts as an administrative body, speaking to the health plans for the physicians, and arranging for payments from the plans to the contracting doctors.
Beginning last fall, local physicians and medical groups began pulling out of the increasingly financially troubled Mission IPA, charging the group with failing to pay physicians'' fees, and failing to provide enough local specialists for their patients'' needs. Earlier this year, Mission IPA began notifying those physicians'' patients that they had to choose other physicians from Mission''s active list, or be assigned one.
Jill Foley, executive director of the Monterey County Medical Society, says her group sued Mission IPA and the health plans it works with last December for past due claims owed to 100 physicians, some more than a year old. "Mission IPA is in breach of its contract," she charges. "Mission has been making promises for a long time and not fulfilling them."
Dr. Eric Del Piero, the Society''s past president, says Mission IPA didn''t help him cut costs or deliver more efficient health care. "It increased the adminstrative cost and overhead of practicing medicine, has in some cases limited my ability to serve patients, and in some cases has not paid bills," he charges.
In February, Monterey Medical Group (MMG), which left Mission IPA last October, and Family Health Resources (FHR), dropped from Mission IPA for failure to sign new, reduced-fee contracts, failed to obtain a restraining order preventing Mission from "grabbing" their patients. A second hearing, asking for an injunction against Mission, was scheduled for yesterday.
Meanwhile, on March 11, MMG and FHR filed for involuntary bankruptcy against Mission in San Jose court.
Is Mission IPA solvent? CEO Charles Vold admits the group is in financial trouble--it had to borrow more than $2 million late last year from its contracting insurance companies to settle debts. Although Mission IPA attorney Peter Rich insists he "has every confidence Mission IPA will weather this storm," Mission''s medical director, Dr. Don Cornforth, couldn''t guarantee this reporter the group will still be in business by April 1.
At risk are the 32,000 Monterey County residents who belong to HMO health plans administered by Mission IPA, notably those several thousand who are patients of physicans that have withdrawn from the IPA.
Salinas resident Thad Holly got his notice in the mail from Mission earlier this month. He called, and was told he had to abandon his family''s physicians at Family Health Resources and switch to others within the Mission IPA family, at least until July, when he''d be eligible to switch to a PPO instead of his current HMO plan.
"My wife was very, very upset," Holly says. "We moved here just over a year ago, and it''s taken that long for our 3 1/2-year-old to warm to his pediatrician. Now they come along and say, we''re giving you another one, have a nice day!"
At least, Holly says, he can afford the increased costs of a PPO plan. "If I couldn''t, I''d have no choice," he remarks.
Philosophies of Health Care
Mission IPA describes the argument as between physicians who favor managed care, and those who oppose it.
Jennifer Laughton, spokesperson for Family Health Resources, who says their 25 physicians are owed between $200-300,000 by Mission IPA, says that''s not the issue at all. "It''s about patient care, and quality care, and patients being able to choose and maintain their physicians," she says.
Mission IPA is clearly on its last legs, battling for its very existence with a doggedness bordering on desperation. They''ve called press conferences, begging for coverage even as their board meets to consider reorganization "options."
They charge physicians from MMG and FHR with badmouthing them in the press while secretly working behind their back to set up a rival IPA and steal Mission''s contracts.
"The physician groups who are leaving have taken it as an opportunity to bash us in the press," charges Cornforth. "It''s frightening patients and agitating employers."
Neil McArthur, who administers Mission''s contracts with 55 physicians, goes further, castigating Monterey Medical Group family physician Dr. Eliot Light personally for "using his patients as pawns, frightening them, telling them we''re not providing access to specialists."
Light responds to that charge quietly. "My job, and my sole reason for becoming a physician, is to protect my patients from abuse from any quarter," he says slowly. "If people want to hear about patient fear, let me talk about patients who can''t see an ENT [ear, nose and throat specialist], opthalmologist or board-certified obstetrician in this county when they have an emergency."
It''s about money and greed, claims Mission IPA: Those medical groups who have left the organization are specialist-heavy, and not willing to tighten their belts and accept the reality of managed care. Cornforth, a radiologist, says his medical group gets paid 35 percent of what they were paid before they joined Mission IPA. "Did we quit? No," he says. "You have to do business in a different way now. The physicians in Monterey County don''t like it, and I don''t blame them. It''s painful. But the consumer needs value, which means cost and efficiency."
The specialists who have left Mission counter that "value" shouldn''t include paying physicians fees lower than Medicare or MediCal rates, or not paying them at all. Most of Mission''s contracting specialists in Monterey County have indeed left the association, on those or similar grounds. McArthur disputes their charges, noting first that Mission still has 60 local specialists on its roster ("more than we need," adds Cornforth), and second, that all physicians have been paid up except those with Health Net. Physicians still claiming to be owed money are simply asking for more than their contracted fees, Cornforth explains.
And as for quality of care, McArthur points to the "excellent ophthalmologists" at Stanford Medical Center, where Mission IPA patients from the Monterey Family Practice group are referred for eye care.
That''s exactly the problem, says Light. Who wants to go out of county for specialist care? "We don''t need an IPA to come to our town to direct our patients to Stanford," he remarks.
And as for being all paid up to local physicians, Foley and Laughton dispute that claim, pointing to physicians within their medical groups with outstanding claims amounting to hundreds of thousands of dollars.
Health care experts aren''t surprised at Mission IPA''s financial troubles; the story is being repeated all across the country. Just last week, the state Senate convened a hearing on physician organization insolvency, in the wake of a rash of high-profile IPA bankruptcies. "A lot of them are failing, a lot of them are declaring bankruptcy," says Laughton.
Mike Dwyer, a managed care consultant and managing director of the Health Care Advisory Services Group of BDO Seidman in L.A., says that the only IPAs that have remained solvent in this country are large groups working in big cities, or small groups that are heavily subsidized.
And maybe, Dwyer suggests, the IPA model is itself to blame. "IPAs are not the most efficient way of managing the costs of health care," he maintains.
Monterey County Health Department Director Dr. Robert Melton says the tit-for-tat battle between Mission IPA and its former medical group partners is happening nationwide, wherever IPAs are failing. "The doctors say the IPA takes too much profit in the middle, the experts on managed care say the IPA system provides no incentive for doctors to be cost-effective, the IPAs say the doctors keep doing procedures and running up costs," he says. "There''s a lot of finger-pointing."
Maybe, local physicians suggest, it''s time to look for another model for managed care. "The dynamic isn''t physicians who are for or against managed care, it''s more that all physicians have different views of what managed care is," says Light. "We''ve adopted a lexicon that reduces patients to ''consumers.'' I''m no longer a ''physician,'' I''m a ''provider.'' One of the great sadnesses is that medical ethics are being replaced by business practices. And unfortunately, the savings to government and employers these practices were supposed to bring have not materialized, or where they have, it''s been at the expense of the doctor-patient relationship." cw