Meeting with Cochran and Sipes

We had the opportunity to meet with Bill Cochran and Connie Sipes on Wednesday, April 12th. I arranged the meeting to discuss many concerns physicians have with our current healthcare environment. We had good attendance from physicians and were able to spend 2 hours in open dialogue with them. Here is a summary of the meeting.

Meeting Summary 4/11/06

Persons attending:
Rep. Bill Cochran
Senator Connie Sipes
Dan Eichenberger M.D.
Vasit Broadstone M.D.
Mary Lynn Bundy M.D.
Jay Hockman M.D.
Steven Gray M.D.
Art Boerner M.D.
Stuart Eldridge M.D.
Phillip Johnson M.D.
Steve Baldwin M.D.
Steve Reagan M.D.
Carol Borden M.D.
Cam Graves M.D.
Steve Pahner M.D.
Guy Silva M.D.
Dan Akin M.D.,
Homer Ferree M.D.
Scott Waters (Board Attorney)

Issue Summary:

Medicaid Managed Care

• System is broken
• 4 separate entities trying to manage same number of patients with 90% of money that the State couldn’t manage it on last year
• Has added a tremendous amount of red tape, paperwork, and hassles to our offices
• Patients are switched from provider and plans sometimes without knowledge and sometimes without reason. This causes problems especially with OB doctors because of the change in plans and their payment
• Some MCO’s have dropped physicians who have high utilizing patients forcing them to accept one of the other MCO’s thereby getting the high utilizing patients out of their MCO
• Payments from MCO’s are held, delayed or simply not paid
• Office of Medicaid oversight complaints and the ability to get successful resolution from the MCO is unsuccessful
• Filing a complaint with the Office of Medicaid oversight about the MCO requires filing every claim that is not paid individually meaning the physician would have to literally send hundreds of individual complaint forms for the same problem.

Medicare

Medicare fee schedule has always been the baseline standard that all other insurers based their fee schedules.

Medicare fee schedule has not increased and in fact, for the first part of this year, dropped 4.4% to primary care. It has been brought back to the 2005 levels.

Fees have not kept up with inflation, cost of living, or other medical costs

Other insurers used to pay at the 140-175% of the Medicare schedule and now United Healthcare, and Humana are at or below Medicare and most others are barely above the Medicare rates.

Offices cannot survive with these reimbursements when all of our expenses continue to increase. The only ways to maintain a practice is to cut costs, cut employees, or see more patients. Most physicians have made all the cuts they can and cannot see any more patients without sacrificing patient care.

The part D drug program is horrendous for primary care physicians. There are 42 different plans and each has their own formulary. Getting overrides and prior authorizations for drugs patients have been taking for years takes a tremendous amount of time, paperwork, phone calls, faxes etc, just to get 1 drug approved.

If this doesn’t change, we will consider dropping Medicare or charging for every override and prior authorization.

Every Medicare Part D plan should have to offer the same formulary coverage.

Malpractice

Indiana has been number 1 in malpractice payouts per 1000 physicians for the past couple of years [Kaiser statehealthfacts.org: 50 State Comparisons: Number of Paid Medical Malpractice Claims, 2003]

Every time a physician is even named in a suit, it counts against them from the malpractice carrier even if the complaint is later dropped

There are only two Malpractice carriers in Indiana and they can drop physicians without specific reason or documentation forcing them to then go into the State program

60% of OB/Gyn docs have been denied coverage by these two carriers and have entered into the State plan at $96,000/year

Anyone can file a “suit” and it can be done off the internet with the review panel. They then sue in State Court, with or without an attorney (pro se)

The review panel does not cost the plaintiff anything, but it is always a “ding” on the physician’s record even when the review panel finds in favor of the physician.

The state program offers only “occurrence only” policies which are more expensive. Claims made policies are inferior from physicians perspectives but are a lot less expensive

Discussed Health courts and the model based on workers comp. courts
[PPI: Health Courts Advance in Congress by David Kendall ]
[PPI: Health Courts: Fair and Reliable Justice for Injured Patients by Nancy Udell and David B. Kendall ]
[Harvard School of Public Health and Common Good to Develop New Medical Injury Compensation System, press release of Thursday, March 16, 2006, Harvard School of Public Health]
[Regulation Magazine Vol. 14 No. 4]
[Executive Summary: Code Blue: The Case for Serious State Medical Liability Reform]

Legislative Issues

Senate bill 124 concerning Most Favored Nation Clauses was allowed to die. [Legislative NewsMarch 20, 2006]

House Bill 1382 concerning fee schedules was allowed to die [Legislative NewsMarch 20, 2006]

Senate Bill 161 concerning the moratorium continues to prevent physicians from investing in other entities and ties our hands from maintaining income that has been lost by other healthcare related cuts. [Legislative NewsMarch 20, 2006]

Senate Bill 140 was allowed to die. This is clearly a tactic that the insurers use to force physicians into otherwise unacceptable network contracts [Legislative NewsMarch 20, 2006]

Contracting Issues

• Insurers do not provide complete fee schedules
• Physicians cannot bargain as a group and cannot discuss fee schedules or contracts because of collusion
• Insurance companies are allowed to know what their competitors fee schedules are
• Contract language has consistently been pro-insurers
• Physicians have little recourse other than dropping the plans which then creates access problems for patients.

Immediate Things to be done

• Working together, develop some immediate recommendations to the Governor for some Executive orders that could bring rapid assistance to the MCO problems in Medicaid and the Malpractice dilemma.
• Establish the working group that Mr. Cochran mentioned. I would be happy to work with the group and could get as many other physicians as needed
• Immediately have the state offer “Claims Made” policies for physicians in the State Malpractice program
• Immediately place a co-pay on Medicaid visits
• Immediately begin working on Health court system and focus group for restructuring the Malpractice process and payment from the “cap” fund
• Immediately get payments from the Medicaid MCO’s to the physicians and stop the delay tactics

Overall, we were pretty surprised on how little our legislators understood about the current environment. They were very understanding and listened intently and we'll see how this information is utilized. Meetings are just meetings if nothing comes from them. We'll see how this particular meeting rates in the next few weeks/months.

Forecast for FLOYDS KNOBS, IN (on a scale of 1-12):

Today's allergy levels: Monday - 7.8/Medium

Today's predominant pollen:Oak, Maple and Ash.