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Out-of-State Physician Reviews Questioned

It’s relatively common practice for utilization reviews — that is, a request for medical services reviewed to comply with treatment guidelines — to be conducted by out-of-state physicians.

A new law, SB 933 by Senate member Paul Fong (D-Cupertino), would end that practice.

On Wednesday, the Senate Labor and Industrial Relations Committee approved Fong’s bill. It is headed to the Senate floor for a vote … maybe. A policy review is under way to determine whether the bill should first go through the Appropriations Committee.

According to Fong’s office, about 80 percent of the disputes over utilization review happen with an out-of-state reviewer, and that’s a big number that prompted this legislation because that might represent a wide gap of understanding about how California medicine is practiced.

“The provision that physicians ought to be licensed (in California) is just a determination to be accountable,” Dr. Steve Cattolica of the California Society of Industrial Medicine and Surgery said. “This will keep cost containment away from medical decisions. That kind of transparency, we think, is important.”

But according to Theo Pahos of the Association of California Insurance Companies, which opposes SB 933, the government should not be involved in the daily mechanics of the health care business. For instance, he said, the legislation calls for re-approval of a medical provider network plan every three years, and that the administrator must sign a statement that there have been no changes to a plan since it was last approved by the administrative director.

“To essentially require a document that says there aren’t any changes is ludicrous,” he said. “People change plans, and plans change all the time. There could be changes from the time you grab the pen till when you sign. Really, this is legal harassment.  We end up with more legal friction, and more cost to the system.”

A representative of the California Chamber of Commerce testified that the bill would increase cost to businesses, and create a logjam of utilization reviews.

But that didn’t make sense to Dr. Cattolica, arguing in favor of the bill.

“This has nothing to do with claims audits,” he said. “There will be no more requests than there would be (without this law).  This is just about accountability.”

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