MEDPARTNERS: Takes Issue with ‘Financially Unsound’ Charge
MedPartners Provider Network Inc. yesterday denied allegations by the state Department of Corporations that it was a "financially unsound" company (Slater, Sacramento Bee, 3/10). Spokesperson Robert Mead also "stressed" that the physician management company "was financially sound and that claims were being processed on time" (Slater, 3/10). The Orange County Register reports that MedPartners also said it was "surprised" by the DOC's order to halt cash payments to its parent company until it could prove its financial health. "Medpartners is confident it will be able to address the department's concerns and demonstrate that (the firm) ... can continue to meet its obligations," Mead said (3/9).
The Birmingham News reports that MedPartner's California operations "have long been a sore point" for its parent company, Alabama-based MedPartners Inc., "which has been struggling lately." The paper notes that the cease-and-desist order does not prevent MedPartners from selling its California operations, "which it plans to do by the year's end." A spokesperson said talks with suitors continue (Tomberlin, 3/9).
CMA to the Rescue?
In related news, the California Medical Association reports that in the wake financial problems of physician practice management companies like FPA Medical Management Inc. and MedPartners, it is testifying today before a state Senate hearing on physician organization insolvency. "We know these groups' financial troubles stem directly from inadequate capitation ... and from plans shifting pharmacy risk to the groups," said CMA Executive Vice President and CEO Jack Lewin. State Sen. Jackie Speier (D- San Mateo) convened the hearing (CMA release, 3/9).