AMA Looks to Revive Collective Bargaining Legislation

Hoping to "revive" legislation that would give physicians the right to bargain collectively with HMOs, the American Medical Association released a study yesterday showing that several insurance markets nationwide are so "highly concentrated" that competition is "imped[ed]," allowing insurers to dictate contract terms, CongressDaily reports. The study found that in many markets one insurer has more than 30% of the market share, and in some areas, insurers have up to 40% and 50% of the market share. Physicians have said that insurers use their market clout to force them into contracts that include unfavorable provisions, such as requiring providers to participate in the insurer's HMO if they want to participate in the PPO (Serafini, CongressDaily, 11/19). Donald Palmisano, AMA's secretary-treasurer, said, "This study gets down on paper something that patients and physicians have learned through painful experience: that in many health insurance markets across the country, health insurers have excessive leverage" (Bloomberg News/Ft. Worth Star-Telegram, 11/20).

Palmisano said the AMA is using the study to renew lawmakers' interest in collective bargaining legislation (CongressDaily, 11/19). In June 2000, the House passed a measure that would have allowed physicians to collectively negotiate contracts with insurers, but the legislation died in the Senate (Bloomberg News/Ft. Worth Star-Telegram, 11/20). That legislation would have exempted independent physicians from "major" antitrust provisions in negotiating for fees and contract terms. Under existing law, physicians who are employees of an organization such as a hospital already have the right to negotiate collectively with their employers. The AMA lobbied for the bill as a necessary tool to allow physicians to promote patient care in negotiations with managed care organizations (California Healthline, 6/30/00). Palmisano said that the AMA had discussed the issue with Bush administration officials, but he did not elaborate on the outcome of those talks.

Although the new bill "might be different" from the original version, Palmisano said, "Whatever restores discussions, we'll be happy with" (CongressDaily, 11/19). The American Association of Health Plans, which opposed the legislation, called the AMA's push for collective bargaining rights an "anticonsumer proposal" that would increase health care expenses. AAHP spokesperson Susan Pisano said, "This is a recycled version of the discussion we went through a couple of years ago. It was a bad idea then, and it's a worse idea now when we have costs rising so rapidly" (Bloomberg News/Ft. Worth Star-Telegram, 11/20). The AMA has said that collective bargaining would "keep costs down because care would improve and lawsuits would decline" (California Healthline, 7/11/00). The failed bill was also opposed by the Justice Department, the Federal Trade Commission and consumer organizations, and any new legislation would likely face similar opposition (Bloomberg News/Ft. Worth Star-Telegram, 11/20).