CMA Stands by the September 1999 PriceWaterhouse Coopers Report: California Physicians in Fiscal Crisis Due to HMO Underfunding
Statement From Jack Lewin, M.D., CMA Executive Vice President/CEO
SAN FRANCISCO, March 23 /PRNewswire/ -- The California Association of Health Plans (CAHP) has done a disservice to the citizens of California with its latest attempt to obscure the reasons behind the precarious condition of our state's health care system. CMA stands behind PriceWaterhouse Coopers' (PWC) report, presented last September at CMA's Summit on Physician Insolvency, that cites the main causes of the crisis: below-average premiums, and the declining amount of those premiums that for-profit health plans are willing to pass on to physicians. On Tuesday, March 21 the CAHP released a document that quibbles with PWC's exact numbers while thousands of patients experience interruptions and delay in care and hundreds of physician groups go bankrupt. This shows just how out of touch with reality CAHP is. The fact is that the cost of medical care is climbing again, while reimbursement for medical services drops. In its report on the medical group insolvency crisis, PWC documented a 35 percent decline in physician reimbursement over the past 10-15 years as the cost of living increased by 25 percent. Nonetheless, CAHP believes ever-tighter cost containment at the expense of patient care is still appropriate. Its logic, as found in its March 21 document, compares medical care and physicians to producers of computer equipment, software, and information systems who lower their per-unit prices and still flourish. Incredibly, they ask why physicians can't do that too? Most people would answer: Because people are not widgets, and physicians are not assembly-line workers "fixing" patients as they move down a conveyor belt. But here we are -- in a society where Starbucks has turned a commodity -- coffee -- into a personal experience, and the for-profit HMOs have turned ultimate personal experience -- health care -- into a commodity. CAHP says today's physician practice insolvency crisis is based on medical group mismanagement. Five years ago, when the amount of money physicians received for treating patients was more reasonable, most medical groups were economically stable. CAHP's president Walter Zelman apparently believes that these medical groups that were doing well five years ago somehow suddenly became incompetent. CAHP apparently sees no pattern, no cause and effect, in the fact that as for-profit HMOs reduced reimbursement rates, the number of medical groups in trouble began to rise. The data that CAHP criticizes comes from a highly regarded, national, independent accounting company. What the data in PWC's report showed was that California-style managed care is in crisis. It clearly is. But rather than address this crisis by trying to work with physicians the way such not-for-profit plans as Kaiser, Lifeguard and Molina are, the CAHP sends up this smokescreen. CAHP and the for-profit HMOs are desperate -- afraid of potential federal Patients Bill of Rights legislation and state legislation that would allow physicians to bargain on equal footing with HMOs over quality of patient care issues and reasonable rates. But this latest salvo of theirs will only further anger and estrange patients and physicians already fed up with the for-profit HMOs mission of putting profits before patients. The health plan industry needs to take a serious look at finding a way to treat patients and physicians as partners -- not as profit sources or pawns. Since the HMO's own organization clearly does not "get it," the company invites the individual leaders of each of the for-profit plans to meet with CMA leaders. Together we can begin to address the real problem of how to adequately finance the delivery of quality health care that all Californians deserve. The California Medical Association represents more than 34,000 California physicians from all regions, modes of practice and medical specialties. CMA is dedicated to the health of all Californians.
SOURCE California Medical Association
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