News Capsules (Summer 1996)

Compiled by Medical Sentinel Editors
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News Capsules
Summer 1996
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Assisted Suicide/Euthanasia

At least two (and soon, possibly three) decisions in the spring of 1996 have boosted the forces pressing for the legalization of assisted suicide an pushing us down the slippery slope of active euthanasia.

On March 6, 1996, a federal appeals court by an 8 to 3 decision struck down a Washington state law banning doctor-assisted suicide, asserting that people have a constitutional right to a physician’s aid in terminating their lives. Judge Stephen Reinhardt of the 9th Circuit Court of Appeals, writing for the majority, expressed the opinion that physician-assisted suicide was a “logical extension of other ethically sound actions (AMA News, 4/8/96).” He further wrote: “Following the recognition of a constitutional right to assisted suicide, we believe that doctors would engage in the permitted practice when appropriate, and the integrity of the medical profession would survive without blemish.”

This same Court of Appeals has already intimated that it will approve an Oregon law that allows the practice. The Oregon law, based on a widely publicized referendum, passed in November 1994 but it has been hotly challenged in court and held on appeal since then.

And in New York, the 2nd Court of Appeals has likewise struck down the state law banning the practice. And the state health commissioner is already preparing guidelines for physician-assisted suicide anticipating legalization in the state.

Meanwhile, Dr. Jack Kevorkian has once again been acquitted of two charges of assisted suicide in Michigan — a state that has passed laws directed specifically at stopping his deadly crusade.

Antitrust Booby Traps

Although health care pundits have predicted that doctors are poised to lead more health care plans, the antitrust guidelines remain a booby trap-laden minefield for unwary physicians — who cannot wait to jump on the managed care gravy train. In fact, the 1994 updated guidelines retain the assumption that “physician networks are illegal per se unless doctors are fully capitated; withhold a set percentage of fees; or use a ‘messenger model’…where a third party conveys physicians’ rates to payers (AMA News, 3/11/96).”

In fact, while in Georgia, the Justice Department confirmed it would not challenge a physician-hospital network (a PHO Southeastern Health Care Alliance), it refused to grant antitrust clearance to a proposed pediatric physician network in New Jersey under the same antitrust guidelines enacted in 1994 (AMA News, 3/18/96).

More Perilous Waters: Physician Networks and Antitrust

In a managed care newsletter (April 1996), the AMA Associate General Counsel encourages physicians who are interested in forming managed care networks to proceed enthusiastically while being “well advised to take the constraints imposed by antitrust seriously” [to avoid prosecution by the Justice Department or Federal Trade Commission]: “Want to be sure your network will pass antitrust scrutiny? Then agree to accept capitation — to make sure the fee withhold you’ve agreed to is substantial enough to qualify.” Accordingly, “A withhold fee is a safer bet because it’s viewed as more likely to motivate physicians to practice conservatively where utilization of services is concerned.” Moreover, “The smaller the withhold, the less likely it is to be viewed as sufficient to affect physician behavior. That’s why withholds of 20 percent are likely to be viewed more favorably than those of 15 percent.”—Editor

Meanwhile In Minnesota…

In Minnesota — the Mecca of managed competition and the epitomized paradigm for state-level Clinton Health Care/Robert Wood Johnson Foundation/corporate socialized medicine scheme — the Governor, Arne Carlson, has vetoed a State House-Senate passed HHS bill which would have limited the expansion of managed care.

Minnesota Physician (April 1996) reports that the state “will continue moving people in its health care programs into managed care, despite lawmaker’s efforts to quash the expansion.”

Moreover, the governor granted the Commissioner of Human Services authority to expand eligibility for the Minnesota Care subsidized insurance programs for those people to 135 percent of poverty by July 1996 (from the present qualification of those whose income is below 125 percent of poverty).

And thus, step-by-step, government-subsidized managed care expands its tentacles to encompass the poor…the lower middle class…[Minnesota, as you will remember, began making inroads with corporate socialized medicine into the middle class beginning with extending coverage for children below 150 percent of the poverty line, and thereafter, expanding coverage until reaching “universal coverage for children.”

“It’s Great to be the King”

While physicians and patients are being forced to tighten their belts in the name of cost containment, managed care salaries of CEOs outpace other industries. Graef Crystal in The Crystal Report found seven CEOs making more than $1 million in 1994 (in total compensation, including salaries, stock options, and other executive amenities).

Crystal writes: “At once, nurses have complained about being put out in the street; doctors have screamed over their declining income; and, at least according to some accounts, patients are angry over what they see as scrimpy service…Is there no one happy in this beleaguered industry? Well, our new study shows there is one group of players in the industry who, by and large, are ecstatic. They are the CEOs of managed care companies:

Norman C. Payson, MD        Healthsource, Inc.                  $14.28 million
Daniel D. Crowley                Foundation Health Corp.         $12.99 million
William Wayne McGuire        United HealthCare Corp.         $ 6.07 million
George T. Jocum                  Mid-Atlantic Medical Service    $ 4.78 million
Leonard Abramson               U.S. Healthcare, Inc.              $ 3.87 million
Stephen P. Wiggins              Oxford Health Plans                $ 2.79 million
David A. Jones                    Humana Inc.                          $ 2.30 million

As Mel Brooks proclaimed, ‘It’s great to be the king!’ (The Crystal Report, Five Verbena Court, San Rafael, CA 94903).”

Medical Graduates Without Jobs

New physicians fresh out of their residencies are having difficulties finding work. In some specialties, more than 10% of residents (from the graduating class of 1994) had not found full-time positions in their specialty by January 1995. “Hardest hit were residents in pathology where 10.8% were unemployed, followed by plastic surgery (9.9%). (AMA News, 3/11/96).”

Primary Care (Gatekeeper) Medical Liability

Professional liability for primary care physicians is rising at an unprecedented pace because these physicians are being sued more than ever before.

According to the Physician Insurers Association of America (PIAA), internal medicine and family physician claims paid rose more sharply than for other specialists, and the cost of the average settlement also rose disproportionately.

As a result, primary care physicians may be saddled with higher professional liability premiums, as is the case in Texas, where two major insurers are seeking to increase their rates to 23% and 45%.

This national trend is the result of three factors: 1) Medication and diagnosis errors, 2) Delayed diagnosis and, 3) “the gatekeeper role assigned to primary care physicians by managed care plans. (The Magnet, May 1996).”

In 1993, in reporting on a state medical society leadership conference on managed care and medical liability, I wrote: “The raison d’etre for HMOs is to restrict care and contain costs. It is common knowledge that, in general, HMO primary care physicians are intended to be used as gatekeepers to restrict access to specialists, and to see as many patients as possible [at the expense of the patient-doctor relationship and quality of care]…All of this…is as unfortunate as it is disheartening for American physicians…we can expect no respite from litigation.”—Editor

AMA’s Flickering Light

Physician’s Weekly (4/22/96) reported that the “AMA’s flickering torch has passed.” The article stated, “Deep in a funk over its moribund membership — hovering at just two-fifths of the nation’s doctors — the AMA has given Dr. P. John Seward, its new executive VP, a mandate to make the association relevant to physicians in a managed care universe.”

Among other things, Dr. Seward said “the seal [of approval of the AMA] would allow the AMA to become the entity certifying physicians as fit to practice — and to become the judge and jury of physician quality.” It’s surmised [as predicted and denounced by the AAPS] that “a centralized full record might materialize.” Dr. Seward further commented that “some physicians would rather the AMA commit its resources to the destruction of managed care…unfortunately, that’s just not realistic.”

Yet, the AMA, according to the report, is prepared to dip into its $130 million reserves “to get its new project rolling.” The pilot project’s first contract is with United Healthcare, a managed care, mega-corporation.

Any independent-minded physician reading these words should feel like Winston Churchill’s opinion of the 1938 Munich Conference, “we have sustained a defeat without a war” (House of Commons, October 5, 1938).

Originally published in the Medical Sentinel 1996;1(2):3-4. Copyright©1996 Association of American Physicians and Surgeons (AAPS)






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