HMO REFORM: Bills Approved as Session Winds Down

On a day that saw lawmakers endorse sweeping changes for state HMOs, the state Senate yesterday followed the Assembly's lead to give final approval to SB 21, which would allow patients a limited right to sue their HMOs for injury. The 22-9 vote came after a "deceptively brief debate," the Sacramento Bee reports. State Sen. Liz Figueroa (D-Fremont), the bill's author, said, "This will help consumers because the behavior of the HMOs will change. They (the HMOs) will have the threat of being sent to court now." But, she added, "We don't feel that consumers are going to be standing in line to go to court."
Opponents decried the bill as a boon to trial lawyers and a future contributor the uninsured. State Sen. Ray Haynes (R-Murrieta) said, "This will probably be the greatest single contributor in driving up the cost of health (care)" of all the health care bills pending. "This could cost 1 million to 2 million Californians their health care coverage because of how much it is going to increase costs." Gov. Gray Davis, through spokesperson Michael Bustamante, indicated he would sign the measure. "It's something that he called for, something that he has fought hard to get, and he will sign it," Bustamante said (Matthews, 9/10).

Independent Medical Review Bill
In addition to the right-to-sue legislation, the Legislature yesterday "completed most of an ambitious state plan to reform managed health care." On a 29-2 vote, the Senate also sent Davis the companion bill to SB 21, AB 55 by Assemblywoman Carole Migden (D-San Francisco), which creates an independent medical review system to "examine decisions by health plans to delay or deny patient treatment based on lack of 'medical necessity.'" The bill, which is designed to narrow the eventual number of lawsuits under SB 21, would require doctors participating in reviews to demonstrate they have no conflict of interest. Bustamante indicated Davis would sign the bill.

Second Opinion Bill
The Senate also approved, on a 25-11 vote, AB 12 by Assemblywoman Susan Davis (D-San Diego), which mandates that health plans provide a second opinion from a qualified doctor if the patient requests it. State Sen. Richard Mountjoy (R-Arcadia) "said it represents a calculated attempt by Democrats to drive the costs of health care so high that HMOs and insurers would be forced out of business," necessitating a government takeover of the health system. "That's the goal of all these mandates," he said. The bill goes back to the Assembly for final approval.

Moment of Truth
The Legislature sent several other bills to Davis yesterday, including several of the coverage mandates on which the governor has hedged with his support. Among them:

AB 88 by Assemblywoman Helen Thomson (D-Davis), which would force health plans to cover nine mental illnesses to the same extent they cover physical ailments. Walter Zelman of the California Association of Health Plans said the 30-6 vote is the one that perhaps worries the industry the most. But Carla Jacobs, a board member of the National Alliance for the Mentally Ill, said, "Finally, with this bill we take a step toward solving the problem of discrimination against people with mental illness" (Ingram/Morain, Los Angeles Times, 9/10).

A bill to strengthen laws protecting the confidentiality of medical records. The 31-2 Senate vote would "prevent health care plans and their contractors from releasing or selling patient information without patients' permission," and calls for fines of up to $250,000 for violations.

A bill that would shift oversight of health plans from the Department of Corporations to a new state Department of Managed Care.

A bill that would require HMOs and disability insurance plans to cover treatment and management of diabetes at the same level they cover other diseases.

A bill that would require plans to cover testing and treatment of phenylketonuria (PKU), a diet disorder that afflicts infants and can cause brain damage.

A bill to require HMOs to cover the screening and treatment of ovarian cancer (Sacramento Bee, 9/10).

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