Federal Judge Temporarily Blocks Doctors’ Motion to End Contracts with Health Plan of the Redwoods
A U.S. Bankruptcy Court judge in Santa Rosa yesterday temporarily blocked a motion filed by 17 physicians to end their contracts with Health Plan of the Redwoods, the Santa Rosa Press Democrat reports (Rose, Santa Rosa Press Democrat, 6/28). Over the past three weeks, about 40 doctors -- specialists whom HPR reimburses on a fee-for-service basis -- have asked for release from their contracts with the health insurer, which filed for federal bankruptcy protection on May 31. According to the motions, the doctors have had to "shoulder an unfair portion" of HPR's $23 million debt and "simply can't afford to continue" with the health insurer without reimbursement for services (California Healthline, 6/25). U.S. Bankruptcy Court Judge Alan Jaroslovsky yesterday said that he required additional time to study the issues in the case. Jaroslovsky will rule on the "narrow issue" of whether the doctors have "personal service contracts" with HPR. Under federal law, doctors who have personal service contracts with health plans may end their relationships with 35 to 90 days notice, but those who have "executory contracts" must provide services until the agreements expire. HPR officials argue that the doctors have executory contracts. Jaroslovsky said that he plans to issue a decision in seven to 10 days. In addition, Jaroslovsky said that he will combine the case of the 17 doctors with the case of a group of 22 doctors who have filed a similar motion. Attorney Samuel Maizel, who represents HPR, said, "It will doom our reorganization if doctors are allowed to decide whether they want to get out. The doctors out there in the community are waiting to see what happens in this court" (Santa Rosa Press Democrat, 6/28).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.