MEDPARTNERS: Doctors Can Accept Check, Give Up Right to Sue

      California physicians, owed $50 million in back payments from MedPartners' California contracting subsidiary, can end the dispute by signing a check. In doing so, however, doctors give up their right to sue the subsidiary and its parent, Caremark Rx Inc, American Medical News reports. MedPartners announced in Nov. 1998 that it was planning to sell practices representing 13,000 physicians in California to concentrate on the more profitable Caremark pharmacy benefits management division, but the state intervened, taking control of the ailing network. In a June 1999 settlement, the state agreed to give control back to MedPartners, which began paying back some of the money it owed to doctors and hospitals and agreed to sell all California practices and "put the proceeds into an account that would be paid out once individual providers agreed to the terms of the settlement." Today, Caremark Rx still owes money to thousands of doctors, but the settlement did not outline the terms of payment. The California Medical Association (CMA) and MedPartners were supposed to compose release forms and send them to doctors in June, but they did not come to an agreement and MedPartners stopped payments in August. Officials from Caremark Rx dismissed accusations that it was "dragging out the repayments" until it had sold all California practices in September. CMA officials have admitted that the arrangement does not guarantee full payment to doctors and that Caremark Rx can pay only 75% of what is owed. Nonetheless, Caremark Rx Chair Mac Crawford said, "We are committed to doing our part to successfully implement the agreement." Caremark Rx said it owes doctors and hospitals less than $100 million and if 6,000 physicians accept the money, the deal will be sealed. CMA CEO Dr. Jack Lewin said, "[W]e are optimistic that physicians will be paid, and we can begin to put the whole MedPartners debacle behind us."

To Sign or Not to Sign
      Not everyone is so optimistic. Dr. Michael Cushing, whose practice was recently sold by MedPartners, said, "It's a terrible deal. They haven't paid the doctors ut they want them to sign the settlement agreement." CMA has convinced Caremark to be satisfied with those with the largest bills and is targeting 1,000 doctors in that category through a telephone campaign. Doctors who came up short in the deal can apply for part of a $25 million letter of credit. Coincidentally, the CMA is now pursuing a lawsuit against eight HMOs to bolster the doctors' claims, claiming that "even when plans have paid financial middlemen such as PPOs and PPMs such as MedPartners, they still have an obligation to pay physicians when those entities fail and reimbursements don't reach the doctors." CMA officials are urging doctors to accept the Caremark checks, as the "chances of getting paid are much worse if they refuse to sign and sue Caremark Rx individually" (Page, American Medicine News, 10/25 issue).