HMO move stirs mixed reactions; Physicians encouraged by UnitedHealth effort to give doctors final say; Step in 'right direction'; Other large insurers express caution about following suit; Health insurance


The decision by the nation's second-largest health insurer that doctors -- not HMOs -- will have the final say on treatment is receiving mixed reviews.

The move last week by UnitedHealth Group was applauded by many, who said it puts medical decisions in the right hands. But others voiced skepticism about the significance of the policy and whether other HMOs are likely to follow suit.

Officials at several HMOs in Maryland last week reacted cautiously.

"I'm not sure what we're going to be doing immediately," said Jeff Valentine, director of corporate communications for CareFirst BlueCross BlueShield. "We already had the policy of having medical personnel review the decisions. We don't have bureaucrats making the decisions."

However, although those decisions are made by medical personnel, they are not made by the treating physician.

Valentine said CareFirst, which handled 25 million claims last year, regularly reviews its policies to make sure that they are meeting consumers' needs. The policy change by United is consistent with marketplace demands, he said.

Aetna U.S. Healthcare officials declined to speculate on what changes they might make in response.

"Certainly, we look at anything a competitor does, said Walter J. Cherniak Jr., a spokesman for Aetna, which has 1.4 million members in Maryland, Washington and Virginia.

United, which covers 14.5 million people nationwide, announced its policy change last week, saying it was paying more to scrutinize and deny questionable treatments than the process saved.

Under the new plan, United will continue to make doctors justify their decisions, but physicians will have the final word. Doctors will be graded over the long term rather than on a case-by-case basis.

"We want to remove the hassle factor," said Dr. David L. Yalowitz, chief medical officer for United Healthcare for the Mid-Atlantic. "We have to allow the physicians to treat their patients as they see fit. We have to remove those obstacles. We want to extricate ourselves from the patient-doctor relationship."

Area doctors supported the United change.

"Physicians regard this as a step in the right direction," said T. Michael Preston, executive director of MedChi, Maryland's state medical society. "Micromanaging their individual decisions regarding care has been a very unsatisfactory part of their relationship with insurers."

Inspired by anger

Paul B. Ginsburg, president of the Center for Studying Health System Change in Washington, also is encouraged.

"I think this is a very important move," he said. "I see it as somewhat inspired by the anger and discomfort by physicians and patients."

He said United has been in the forefront of encouraging physicians to communicate with patients about preventive medicine, he said.

"It's a positive competitive strategy to start moving the industry in the direction that you're more equipped to go in than your competitors," he said. "Probably some other plans may do this, but I don't think we'll see a rapid rush to do this. Within two years, either a lot of plans will have switched or United will have backed off."

Ginsburg believes that United's announcement received so much attention in the news media because it coincides with growing resentment toward HMOs and the congressional debate on a patients' bill of rights.

Larry Levitt, a health care analyst with Kaiser Family Foundation, said the move by United is a major development, both in the marketplace and the politics of HMOs.

"I would expect others to follow suit, because they're very much considered a leader and innovator," he said. But that might not happen for a year or more, he said.

"The idea of insurance companies second-guessing doctors has always been the thing that angers doctors and patients the most," he said.

"We applaud their move," said Elizabeth Sammis, a spokeswoman for Mid Atlantic Medical Services Inc. "We expect to take a look at our policies and procedures. I don't know if we've concluded that we need to make any changes."

MAMSI covers 1.8 million people from Pennsylvania to North Carolina. Its two HMOs in Maryland are Optimum Choice Inc. and MD-Individual Practice Association Inc.

In some way, United is still vowing to monitor the doctors and their cost-effectiveness. "Depending on how it's done, there's the potential to replace one cost-containment strategy that makes people angry with another one that makes people angry," Levitt said.

Levitt also found the timing of the announcement suspect.

"I don't think the timing is an accident," he said. "Congress is debating patients' rights. So if HMOs aren't making the decisions about patient care, there would be no reason to sue them."

Will changes stick?

Levitt said he wonders what will happen once constraints are removed from doctors. "Will those changes stick or will doctors revert back to the way they used to practice medicine?" he said. "Will doctors still do more surgeries outpatient or will it be like freshmen going away to college?"

He also suggested that prices could continue to increase, especially for prescription drugs.

Some consumer groups are skeptical about whether the policy change will improve patient care.

"The pressure is still on the doctors to be cost-effective," said Judy Waxman, director of government affairs with Families USA, a consumer advocacy group in Washington. "What this change is going to mean for consumers is not clear. How much it's going to change patient care for the better, we're going to have to wait and see."

Waxman said it will take a year -- maybe more -- to properly evaluate the impact of United's policy.

One piece of puzzle

"I think some people have been blowing this out of proportion," she said. "It's a positive thing to let doctors decide, but it's just one small piece in a very big puzzle."

At least two Maryland HMOs, Kaiser Permanente and the Preferred Health Network, said they have been allowing doctors to have final say on treatment for years.

"My reaction to it was, why was this on the front page, because we've been doing this for 50 years," said Dr. Martin R. Lustick, a pediatrician with Kaiser Permanente and vice president and associate medical director for operations for the Mid-Atlantic Permanente Group. "The doctors control the decisions about care. There's nobody in the health plan insurance division who looks over and says that's not going to happen."

The Preferred Health Network always has let doctors decide treatment, said Dr. Dennis A. Batey, president and CEO of the Linthicum-based health provider.

"It's been a surprise that it's taken some of the larger plans as long as it has," Batey said. "People are demanding choice. I think United is responding to that."

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