MEDPARTNERS: State Regulators Uncertain How to Ensure Care
What will follow last week's state takeover of MedPartners Provider Network Inc. remains uncertain. Regulators admit they do not yet know "how to guarantee continued care for" MedPartners' 1.3 million patients in California. With no funds allocated to bail out ailing providers, no "blueprint for how to run the company or solve its financial problems" and a slew of suits by angry doctors awaiting payment, it is an open question how long the state will be forced to play caretaker. The Los Angeles Times reported Saturday that the takeover -- an "aggressive move that would have been unlikely" before Gov. Gray Davis (D) was elected -- was intended to "head off what some regard as a potential crisis in the health care industry" (Bernstein/Leeds, 3/13).
Today's Wall Street Journal reports that the immediate trigger for the state's takeover of MedPartners Provider Network Inc. was the discovery by regulators that the California plan "couldn't provide accurate information about its finances and had a large backlog of unpaid claims" (Rundle/Jaffe, 3/15). The Orange County Register reports, however, that the move came "after an apparent showdown [last] Monday between state regulators and MedPartners officials," who told the state "it could stop funding the California entity 'at whim.'" The company threatened to close operations in the state within 24 hours if the state did not amend or withdraw a March 5 cease-and-desist order (Crabtree, 3/13).