VENTURA COUNTY: CMA Wants Loan to Save Physicians Group
The California Medical Association is looking for a $3 million emergency loan to save the largest group in Ventura County, which is "teetering on the brink of bankruptcy," the Los Angeles Times reports. Family Health Care Medical Group serves about 135,000 patients, and could close within a few weeks unless its $1 million debt is "rectified immediately." The CMA asked for the loan in a letter to the 13 health plans that contract with the group. The "insolvency and potential closure would cause serious instability in the delivery of health care services and leave specialist physicians with over $1 million in unpaid claims," the letter said. More than two dozen physician groups in California have failed in recent years -- most of which blame low payments from managed care organizations for their troubles. If Family Health closes, the CMA says there are no other groups available to "absorb so many extra patients" in Simi Valley, Thousand Oaks, Camarillo, Moorpark and Oxnard. Andre Berger, a consultant for Family Health, said meetings with the health plans on Monday went well. "We told them about our financial condition and the recovery plan and asked them for money. They listened. There was no negative response," Berger said. He added that with the loans, Family Health "could be back on its feet in 18 months" and start a repayment process. Family Health has been trying to save itself by cutting costs, correcting computer programs and improving contracts with the health plans. Berger said, "This organization has some critical financial issues. But all are reversible with the infusion of some funds from the health plans, at least $3 million." This is not the first time the CMA has intervened on behalf of a physician group. KPC Medical Management, the state's largest group, recently received a $30 million bailout from health plans (Kelley, 9/20).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.