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California’s crisis grows deeper

Posted Mar 17 2010 10:30am 2 Comments

The Riverside County Medical Association announced today that a new bill – SB 726 that is now on the assembly floor must be stopped. It is predicted that the bill would erode the patient protections of the bar on the ‘corporate practice of medicine’ in California. It is sponsored by AFSCME, a labor union interested in unionizing doctors, and the California Association of Healthcare Districts, whose members want to hire and control physician services.

Recently, the supporters have significantly stepped up their attacks on the County Medical Association and physicians who support the ban. Low ball tactics such as incendiary press releases, a factually inaccurate website, and increased presence in the media are all being utilized to pressure legislators to erode the ban on the corporate practice of medicine.

Please be advised that the unions and hospitals are urging their members and other physicians to call to register support so your participation is absolutely necessary so that legislators know the true impact this bill would have in their districts.

Your involvement is critical to ensure that legislators understand the impact this bill will have on the quality of care their constituents receive in California hospitals. We need to let these legislators hear from as many doctors as possible that these bills are bad for patients (their constituents).

Talking Points

. The ban on corporations practicing medicine is an important protection for patients in California hospitals. This protection ensures that those who make decisions that affect the provision of medical services (1) understand the quality of care implications of that medical service; (2) have a professional ethical obligation to place the patient’s interest first; (3) are subject to the Medical Board of California.

· SB 726 will erode the quality of care in California hospitals. It will grant control over physicians who should be making the decisions on treatments to hospital CEOs and administrative staff who have different motivations and mandates than physicians. This will create conflicted loyalties in an institution that must remain true to the patient’s interests, and will erode the quality of care patients receive in California hospitals.

· Placing doctors under the oversight of hospital administrators and CEOs who are under enormous pressures to cut costs or increase revenue will threaten the independent medical judgment necessary to ensure patients are protected. A study has recently been released showing a motivation for hospitals to acquire physician practices is financially and anti-competitive based, not just for increased access for patients.

· Hospitals are already interfering with medical staffs’ ability to ensure quality care through independent self-governance. For example, some hospitals have adopted medical management protocols which have resulted in inappropriate hospital tests, procedures, and stays, jeopardizing patients and increasing costs.

· Allowing a hospital to directly employ a physician will NOT increase access to physician services. The hospital will push patients to their preferred provider thereby controlling the competitive market. Other non-employed physicians will not be able to compete and likely be forced out of town resulting in no increased access.

· CMA supports policies that will truly increase access to care, without compromising the quality of care. The CMA supported bills that now are providing over $2 million dollars in medical school loan repayment for physicians who agree to practice in these areas. Since loan repayment obligations is one of the primary reasons physicians will not go to underserved areas, this will attract physicians to these areas without compromising the quality of care patients receive.

· Hospital Districts already have numerous financial incentives they can use to recruit physicians. Proponents of eliminating the corporate bar, including hospitals districts – have failed to show why allowing corporate entities to directly hire physicians would work where these incentives have failed. A list of incentives currently available to hospitals and hospitals districts include:

- guarantee to a physician and surgeon a minimum income for a period of no more than three years from the opening of the physician and surgeon’s practice,

- guarantee purchases of necessary equipment by the physician and surgeon,

- provide reduced rental rates of office space in any building owned by the district or any of its affiliated entities, and

- provide other incentives to a physician and surgeon in exchange for consideration and upon terms and conditions the hospital district’s board of directors deems reasonable and appropriate.

None of these incentives grant hospitals or hospital districts the control over the actions of physicians which they seek through the ability to hire physicians – the real goal of eliminating the patient protections of the corporate bar.

It is critical for the integrity of patient care in California hospitals that physicians remain independent from the corporate influence of hospital administrators and CEOs, who must answer to priorities other than patient care. By eliminating this protection for patients, SB 726 will erode the quality of care those patients receive in California hospitals.

The ban against the corporate practice of medicine provides a fundamental protection for patients by ensuring their physicians’ sole interest is what is best for the patient. When hospitals are allowed to directly employ and charge for physician services, quality of care suffers due to the fact that hospitals derive income from patient beds being filled.

I recognize there is a shortage of physicians in some areas. However, there are ways to address that shortage without allowing hospitals to control physician employment. Increasing slots to allow residents to train in California, developing the medical schools at UC Merced, UC Riverside and expanding access to California’s loan repayment program will truly ensure physicians go to and stay in rural and underserved areas.

Simply allowing hospitals to employ physicians may actually result in reduced access and increased costs. Hospital employment of physicians eliminates competition for outpatient services and instead forces all care to be delivered through the hospital. As hospitals gain market share in small communities, physicians not employed will likely be forced out of business and surgery centers outside the hospital will likely be forced to close. This results fewer options for patients and increased costs as the hospital is able to charge higher rates with the elimination of competition.

As if the insurance companies, fortune 500 CEOs who own them, and their constituents didn’t have enough control, now they want to be the ones to actually pull the plug and demand payment right then and there – and this of course comes from California, a state where logic is absent and government strangles (quite literally if they get their way) the very last breath from your dying body.


Comments (2)
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- There are so many down sides to being a physician in California now, that is why physician recruitment is not working. Look at it from a purely business point of view, physicians used to make serious money with relative ease. Since times have changed dramatically it is somewhat of a hassle for doctors to make any decent amount of money in the state of California due to; sky rocketing costs of living/taxes/business expenses, terrible business climate, increasing number of malpractice suits, increasing cost of malpractice insurance, increasing demand placed on individual physicians, and decreasing payments from insurance companies accross the board.

 - are there administrative people who interfere with physicians treatment of patients on a daily basis? you bet, in almost every hospital out there and in most of the doctors offices too; usually the ones who are worried more about paying the bills than whats best for the patient. Does it get brought up in a legal setting to challenge such policies? Never seen it happen yet, wouldn't expect to either - most physicians would find ways to justify their treatment decisions to best suit their own needs, remeber they are there to make money also and if they tell you otherwise they are lying.

- the physicians i work for won't treat medi-cal patients on an outpatient basis, they will only see them in the ER and only for truely emergent cases. It may sound harsh but I don't blame them at all for that decision, sometimes medi-cal sends checks for less than a dollar; I have actually seen a medi-cal check worth less than a stamp before. Would you want to treat someone who collects on tax paid benefits that ultimately pay you fractions of a penny on the dollar? The fact is - this state (dare I say this country as well) cannot afford to continue paying for healthcare for everyone it is just not possible.

I would go out on a limb and say that the doctors DO want to treat the patients for the most part - doctors are in it for money but to be a doctor they almost have to have some sort of care for others - but they also want to be paid for their services just like everyone else. The fact of the matter is that medi-cal doesn't pay.

- Of all the licensed physicians in California I would have no real idea of how many support the bill. I know that not one physician in our practice supports it. Having had a relationship with all the physicians (and their offices) who refer to our office for years I would strongly suspect that 9/10 of them would vote the same way, but that is in no way a rock solid number - just an educated guess.

Some thoughts from a possibly uniformed but none the less interested party

Given the California budget dillema, is it realistic to expect the State will fund Merced/Riverside Medical schools and can 20% of California wait the seven years for those freshman medical students to start work?  More importantly, if the financial model options for these students do not change..will we not just have more of the same ? Little primary care, too many specialtist . No physicians in rural communities???  BTW the Mecial Boad of California reports tha 58% of Claifornia MD' live in one of five counties-any guesses?

 An internet search of the Steve Thompson scholarship fund shows an annual number of applicants to be 40 with the average number of awards being 5 @ an average of $50k-Appears young docs  have little interest and minimal success in receiving the awards (20% success)

If existing tools for recruiting physicians are effective, why aren't they working ?  If after the guarantee/support period the doctor can not survive economically what happens? My guess is they leave

 It is my understanding that existing law prohibits lay personnel from inteferring with physician practice-I believe CMA introduced that legislation in the late 90"s.  Are there any isntances of this law being violated?

 A recent study authored by UCLA suggests that 20% of Californians are uninsured or on Medi-Cal-who will care for these people?  CMA reports 70% of California physicians will not treat Medi-Cal due to the economics of doing so-this appears to ba a public health dillema-I am worried why aren't others?

 I have looked at the doctorsforall website--which comments are untrue-it would be important to confirm and I for one would like to know.

 My sister works at a surgery center that is owned by a group of physicians-she tells me that Medi-Cal patients are never treated there-why is that?

 I see this bill as a solution to taking care of people that 70% of doctors don't want to take care of--why would those 70% get in the way of doctors who would provide that care

The Medical Board of California  notes there to be 128,000 licensed MD's in Ca-how many of those are members of the primary oppositon to the bill -the California Medical Association?  Most, all, some?

 I  note on the doctorsforall website that the Medical Board of California has registered a letter of support-As the state agency charged with monitoring physician practice, their support for the bill seems to be a good thing-True?

 Allen Thomas

Fresno Ca



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