Managed care legislation may head your way in 1997

Outpatient mastectomies, gag clauses key issues

The uproar over the so-called "drive-through delivery" legislation has ended, but its effects are far-reaching. The legislation, which requires health care coverage of at least a 48-hour hospital stay for vaginal deliveries and a 96-hour stay for cesarean section deliveries if the physician and patient deem necessary, illustrates the extent to which advocacy groups will go to encourage legislative mandates of benefit coverage. Industry officials and health policy experts say we can expect more of the same in 1997.

Experts say physicians should speak up to their lawmakers if there are legislative topics that disturb them. And physicians may be on the receiving end of consumer frustration over issues under governmental debate.

"You have a phenomenon going on that really bothers a lot of people, and we don’t have any vehicle to adjudicate it," says Robert J. Blendon, professor of health policy at Harvard University. "Insurance companies are taking over and making decisions about health care policies. [Legislation] is not the way to solve it. But at the same time, we don’t have an ideal vehicle for dealing with it."

What managed care-related legislation should you expect in 1997? Experts interviewed by Physician’s Managed Care Report mentioned the following hot buttons:

1. Hospital stays following a mastectomy. Recent media coverage in The Wall Street Journal and other publications has raised concern over new guidelines from Milliman & Robertson suggesting that mastectomies in routine, uncomplicated cases can be done on an outpatient basis. Since November, legislators from at least three states — Florida, Connecticut, and New Jersey — have vowed to push for legislation requiring insurers to provide coverage for at least 48 hours of hospital care following a mastectomy.

Managed care organizations are obviously concerned about the potential for legislation on the mastectomy issue, as evidenced by a policy statement issued by the American Association of Health Plans (AAHP), a managed care industry group in Washington, DC. The policy statement stresses that decisions about a hospital stay following a mastectomy should be made by a woman’s physician in consultation with the patient, not by set standards from a managed care organization. Although AAHP does not believe the statement will pre-empt legislation from being introduced, "we just wanted people to know where HMOs stood on this issue and what we think are good practice patterns," says AAHP spokesman Donald White.

2. Medicare reform. Lower Medicare reimbursement to providers is likely, although it is not yet clear how large the decrease will be, Blendon says. White says the federal government will likely appoint a bipartisan panel to study the issue, and that legislative proposals relating to Medicare will cover many of the panel’s recommendations.

Expected reimbursements, in addition to the increasing popularity of Medicare risk HMO contracting, has prompted the American Medical Association to present a Medicare reform package, says Carol O’Brien, senior attorney with the AMA. The AMA is particularly concerned that Medicare beneficiaries with chronic conditions may be shortchanged, she adds.

"Relatively healthy senior citizens may actually find their health care [under a Medicare risk HMO] is less costly and provides better access to preventive care. But is the system going to be able to handle patients that become chronically ill?" she says.

Regardless, it’s clear that enrollment in Medicare risk HMOs is already growing. In 1996, there were 4.6 million Medicare beneficiaries enrolled in Medicare risk HMOs, representing about 12% of the Medicare market, according to the Health Care Financing Administration (HCFA). Just five years ago, HCFA statistics showed that only 4.2% of Medicare beneficiaries were enrolled in Medicare risk HMOs.

3. Provider due process remedies. The AMA wants there to be more legislative requirements regarding the information health plans give to physicians who are deselected from a provider network, O’Brien says. Details would vary from state to state, but would likely require deselected physicians to have the right to a hearing, or that standards for the contract termination be published in writing. Several states already have passed legislation, including Maine, Maryland, New York, Colorado, and Oregon. States looking at similar legislation — which would stand on its on or be attached to gag clause legislation — include Alaska, Connecticut, Florida, Hawaii, Idaho, Illinois, Missouri, New Jersey, Ohio, and Oklahoma, O’Brien says.

4. Gag clauses. A related issue deals with so-called gag clauses, which prohibit or restrict physicians from discussing care options not covered by the patient’s insurer. Although some insurers, including Humana, have withdrawn gag clauses, O’Brien says at least 13 states are poised to introduce gag-clause legislation.

5. Specialist referrals. Discussions began in 1996 about appropriate referrals for specialists, and they will continue in many states, O’Brien says. New Jersey, for example, is proposing legislation requiring direct access to specialists for people with certain chronic conditions.

6. Coverage of the uninsured. The Clinton administration has suggested that it is examining programs that would provide health care for uninsured children, White says. No one is quite sure how the program would work or who would foot the bill. Why children? "The watchword is ‘incremental,’" he says. "They’re a good place to start. I think there will be some very broad, open discussions on this issue in the coming [federal legislative] session."

Legislative mandates likely for near future

The bottom line is that legislative mandates will continue to be a popular way to solve the conflicts between physicians and managed care organizations, Blendon and others say. Because the managed care industry is new, it has not had enough experience in issues management. "When you’re building a new industry, the execs don’t have a history on public issues," he says. "But they do know that once the topic crops up on 60 Minutes, it’s best to settle it."

And once legislation is passed, physicians may have to deal with consumer misinterpretations of the law. Meridian Medical Group, an 80-physician group practice in Atlanta, has been surprised at how some patients have interpreted state maternity legislation that became effective in July, says Donald Lurye, MD, Meridian’s associate medical director for managed care.

Many patients have interpreted the legislation to mean they are required to stay in the hospital for 48 hours following a delivery. However, the legislation’s true meaning is that health insurers are required to pay for a 48-hour stay if the physician feels the mother needs to stay 48 hours. As a result, Meridian’s physicians have had to explain this distinction to patients.