Seeking a Cure

Norma Barry had been treated by Simi Valley family doctor Elvin Gaines all her life. She trusted him so much he delivered both of her babies.

She believed in his judgment to such a degree that she never argued when Gaines prescribed common painkillers after she complained of headaches and dizziness.

Then, in late 1996, she died at age 26 of a massive brain hemorrhage, and evidence suggests she may have suffered from a series of small brain bleeds.

“I blame myself so much for not making her go to another doctor,” said her husband, Simi Valley truck mechanic Jerome Barry.

Just a few years ago, the Barry case would have represented nothing more than a routine, though tragic, claim of malpractice--a lawsuit not yet resolved in court: Gaines insists he did nothing wrong, and his attorney says medical records do not show a history of chronic headaches.

But in this year of HMO reform, it stands as a purported example of how HMO financial incentives to cut costs can interfere with a doctor’s treatment of his patients--and as a reason that lawmakers, doctors and patients are trying to change managed-care medicine.

Jerome Barry claims not only negligence, but that his wife was mistreated by Gaines because an HMO contract required the doctor to pay out of his own pocket for the costly special test the young mother needed, but never got.

HMO critics maintain that the Barry case is emblematic of larger issues that need to be addressed as personal and public fixes of the system are considered:

* Patients need to be their own best advocates by insisting on effective treatment and asking their doctors whether they make more money if they provide less care.

“People out there ought to know that they’re not getting referrals because these doctors get kickbacks at the end of the year,” said Virginia Lemos of Port Hueneme, whose mother died of cancer in March.

* Doctors need to reject--or question ethically--HMO contracts that force them to see too many patients and pay them more for not treating patients with costly care.

“Managed-care groups have castrated the doctors, really. You either sign the contract or hit the road, Jack,” said Dr. Claudia Jensen, a Ventura pediatrician. “But now the doctors are acting up. They’re working for less money to try to regain control of their relationships with patients.”

* Lawmakers need to change state and federal law so patients can sue HMOs and health insurance companies--not just doctors--for policies that contribute to the death or injury of patients.

“HMOs really only look at money,” said Oxnard attorney Mark Hiepler, who represents Jerome Barry, and who won a $2.9-million verdict against Gaines in a similar case in 1995. “So the most efficient way to regulate them and to change their behavior is for juries to award money to their victims.”

More than anything, however, what patients can do to help themselves is to speak up, patient advocates say. The more persistent patients are requesting more time with doctors, extra diagnostic tests and costly referrals to specialists, the more successful they will be.

Indeed, patients need to be much more active long before they become sick.

“When you choose your health-care plan, it can be the difference between life and death,” said Pamela Hasner, founder of Patient Advocacy Management in Ventura. “People spend more time deciding on kitchen appliances than they do on shopping for their health care. They never ask the question, ‘What will happen if I really need it?’ ”

Comparing Treatment

Thousand Oaks veterinarian Leslie Schwartz said his family has received much better care from their HMO since he compared the treatment policies of his health plan with industry norms and found them wanting.

Previously, his wife, Toni, endured excruciating pain during treatments in which doctors dilated her infected gall bladder and ran a tube down her esophagus after giving her little or no anesthetic.

“She said it was the most painful thing she’d experienced in her life,” he said of the throat probe.

“The minimal standards are probably what our HMO was meeting,” Schwartz said. “We’ve really got to fight to get the extras. That’s the difference between quality care and just being a number.”Indeed, a host of proposed reforms are moving through Congress and the state Legislature that would guarantee HMO patients an array of new rights to quality care.

This year alone, state lawmakers have approved changes effective next Jan. 1 that will give women direct access to gynecologists as their primary doctors and allow patients to keep taking prescription drugs even if the drugs are removed from an HMO list of approved medicines.

Creation of a strong state HMO watchdog agency is also in the offing, and there is widespread backing for independent ombudsmen to help consumers with HMOs.

A new state law that takes effect this month establishes terminally ill patients’ right to quick and binding independent review of their cases.

In Congress, Republicans and Democrats agree that reforms should include a patient’s right to emergency-room treatment without HMO approval, the right to appeal HMO denials to an independent third party, and doctors’ right to discuss with patients the full range of medical options, not just the ones covered by a patient’s HMO.

Doctors have weighed in at both the state and federal levels on behalf of the strongest reforms.

Kenneth Saul, a Thousand Oaks pediatrician, said that the most important discussion at a recent statewide pediatric convention was about setting minimum standards so doctors can strongly oppose the skimping on treatment that is sometimes policy at HMOs.

“The reputation of my profession is being harmed, and that hurts me,” Saul said. “Patients are being harmed, and that hurts me. We’ve all got to take a stand against these contracts that pit doctors against their patients.”

The California Medical Assn. is pushing establishment of “best practices” standards for all specialties so all doctors have guidelines to follow, said President Robert Reed, a Santa Barbara physician.

“There’s a fair amount of flying-by-the-seat-of-your-pants judgment involved now,” he said. “But if physicians can support their decisions through evidence-based medicine, they’re in a better position to recommend further treatment, and to eliminate waste.”

Dearth of Quality Data

Too little evidence exists today to say precisely what treatment is necessary and what is not, Reed said. And too little money is being spent to develop it, say consumer advocates and employer groups.

Some big businesses are so frustrated by the dearth of quality data that they can use to compare HMOs that they’ve begun creating their own.

For example, the Pacific Business Group on Health, an influential health insurance-purchasing consortium, released its ratings of HMOs in California last month based on a survey of doctor groups: PacifiCare and Health Net ranked highest, and Aetna U.S. Health and Blue Cross of California ranked lowest.

“Trying to figure out what’s happening in health care these days is like trying to piece together a jigsaw puzzle,” said Pat Powers, executive director of the business group.

Even the besieged HMO industry is backing significant reforms in California, and HMO companies have already begun to give consumers more of what they want.

Health Net has sped up its appeals process after patients are denied treatment and now guarantees that review by an independent third party.

And several HMOs have streamlined access to specialists or allowed limited self-referral to specialists by patients themselves.

HMO representatives also insist that they have taken steps to guarantee a high level of medical care by doctors through “physician report cards.”

These gauge patient satisfaction and include the review of doctors’ performance by their peers.

Even the physician report cards are controversial, however, because an HMO’s criteria for judging performance are commonly based not only on patient satisfaction but also on how many patients doctors see, how much they spend on treatment, and how many referrals they make to specialists.

A San Diego doctor recently won a $2.5-million settlement from a medical group after a jury found he was fired for refusing to skimp on patient care.

Of all the reforms, perhaps the most controversial is a proposal to allow patients to sue HMOs for damages.

Controversial Proposal

As things stand, HMOs are usually protected from paying damages for personal injury because a federal law exempts private employer-based benefit plans from state medical malpractice laws. The Employment Retirement Income Security Act of 1974, or ERISA, was passed to protect company retirement plans. But courts have ruled that it shields HMOs for lawsuit losses as well.

Key exceptions to this rule are church employees and government workers of all types--including schoolteachers. They can sue HMOs for damages because they do not work for private employers.

President Clinton, congressional Democrats and some Republicans also say that HMOs should be accountable.

But most congressional Republicans side with insurance companies and employers in opposing the reform, arguing that it would prompt frivolous lawsuits and hike the cost of health insurance for everyone.

There is a similar bipartisan split in the California Legislature. And a managed care task force appointed by Gov. Pete Wilson refused to include the right to sue HMOs in its 64 recommendations for reform.

But many doctors--traditional enemies of lawyers like Hiepler--agree that insurance companies should be responsible when they deny care to patients.

“It doesn’t make sense that HMOs are singled out for protection. Now they can do whatever they want and not be held accountable,” said Mary Carr, executive director of the Ventura County Medical Society.

Likewise, Reed, president of the state medical association, said the medical directors for HMOs and the physician networks that contract with them should share the burden if things go wrong.

“They’re a partner with the doctor on the care and they should be a partner in the liability,” Reed said.

A Ventura County lawsuit that Hiepler filed last week on behalf of a 66-year-old Oxnard woman would test that theory in court, even without a change in law. Joyce Wooten sued the medical director of a local physicians group, Seaview, for refusing to follow the recommendation of her doctor and approve a CAT scan of her brain. Two weeks later she suffered a debilitating stroke.

“I’d like to fix what’s wrong here,” said Wooten, a retired civil servant. “I’d like it to be where if someone else comes along and needs a CAT scan, they get it.”

Several federal judges have also abandoned their usual judicial neutrality on legislative issues to urge Congress to amend ERISA, because it leaves patients harmed by HMOs with no meaningful legal means to recover damages.

Suing Health Plans

Of the 50 states, only Texas has passed a law allowing HMO patients to sue their health plans for negligence if they do not use “ordinary care” in denying or delaying payment for treatment. California lawmakers are considering a similar bill. Insurance companies are challenging the Texas law in court.

In California, patient advocate groups statewide are pushing hard for an amendment to ERISA, or passage of the state alternative. Without it, HMOs have no real financial incentive to change, they say.

“There are two ways to truly reform HMOs,” maintained Jamie Court, director of Consumers for Quality Care in Santa Monica. “One is to hold them liable in court if their policies lead to the injury or death of patients. Two is to alter the beast at the heart of the system--to make it illegal for financial incentives or bonuses to be paid to doctors for not treating patients.”

HMO industry officials say incentives for good care are built into the managed care system. HMO contracts tie doctors’ financial interests to keeping their patients healthy or treating them right the first time they are sick. If they don’t, patients get sicker and care costs the doctors more in the long run.

In addition, changing ERISA would erode the ability of managed-care plans to control costs and make health insurance unaffordable for millions, said Mauren O’Haren, acting president of the California Assn. of Medical Plans, an HMO industry group.

“The working middle-income groups would be hit, especially,” she said. “[One study] estimated these bills would increase the cost of health care 5% to 12%, and 2 [million] to 4.8 million people would lose their coverage.”

A better solution, she said, would be a new state law backed by the HMO industry that would give patients the right to an independent review of their cases by medical experts, so they could quickly receive a second opinion.

“If it were your child, would you prefer the ability to get a timely review, or the ability to sue the plan five years down the road?” she said.

Employer groups also insist that a spate of lawsuits would drive the cost of medical insurance so high that small employers and self-employed workers could not afford it.

“If it drives the cost of medical care up, we won’t like it,” said Penny Bohannon, president of the Ventura County Economic Development Assn.

However, two new studies--by the Kaiser Family Foundation and the Congressional Budget Office--found that allowing patients to sue HMOs would hike the cost of health care far less than previously projected.

Preparing a Case

Against this backdrop, lawyers for Norma Barry and Dr. Elvin Gaines take depositions and plot strategies.

A prominent Simi Valley doctor and a partner in a large physicians’ group, Gaines says he does not remember Norma Barry complaining of headaches.

“As I sit here today,” Gaines said in a sworn statement in March, “there were not complaints of chronic headaches to me.”

And Long Beach lawyer Richard Carroll insists that Gaines is a fine doctor. That Norma Barry died of a catastrophic bleed that occurred without warning. Gaines is the victim, Carroll argues, of Hiepler’s overzealous mission to castigate HMOs for wrongs that do not exist.

“Bad medicine costs more money than good medicine,” Carroll said. “To argue that the reason Dr. Gaines didn’t do a CAT scan was to save whatever minuscule amount of the $1,000 he would have saved is idiotic.”

Indeed, the Barry case is based almost entirely upon recollections of Jerome Barry that are not supported by medical records, Carroll said. On the other hand, Norma Barry had a history of drug and alcohol use and was “out partying” the night before she died, he said.

But Hiepler, who is known nationally for his legal end-runs around bans on suing health plans, said he intends not only to put Gaines on trial, but also to challenge the “capitated” payment method HMOs use to shift the financial risk for medical treatment to doctors.

Under this system, doctors are paid the same small fee per patient per month regardless of how much care a patient actually receives. And when they refer patients to specialists outside their group, they sometimes must pay part of the cost of that extra care.

That created a clear conflict of interest, Hiepler maintains, that contributed to the death of Norma Barry.

Hiepler argued the same thing in a 1995 legal victory, when he sued Gaines for diagnosing the colon cancer of 35-year-old Joyce Ching too late to save her life, despite her requests for more sophisticated diagnostic tests.

But Municipal Judge Ken Riley refused to allow a Ventura jury to consider that argument during final deliberations because Hiepler had not proved his claim that greed was a factor in Ching’s treatment.

The jury’s $2.9-million verdict in Ching was pared to $700,000 to come in line with legal limits in cases of simple malpractice.

Hiepler still maintains that Ching’s insurance company--the Metropolitan Life HMO--should have been on trial that day as well.

“If we can make the HMOs responsible, the doctors will follow in turn,” he said. “The doctors respond to the problems the HMOs create.”

But Los Angeles attorney Michael D. Gonzalez, who represented Gaines in the Ching case, said the managed-care industry is reforming itself.

“To me the question is, ‘Is health care better than it used to be?’ ” Gonzalez said. “And I say HMOs and managed care offer greater access to more people than ever before.”

That’s little comfort to Jerome Barry. He said his wife had plenty of access to Gaines.

She saw him six times in the last nine months of her life, according to the lawsuit. And she went to emergency care another time.

“I was there for so many of these visits. She had so many really bad symptoms for a year,” Barry said. “And he just told her to go to a gym, go see a chiropractor. Take Advil or take Motrin. He was her doctor. She believed him. . . . Never just believe.”

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Questions to Ask HMOs

Q. What percentage of my premium dollar actually goes to medical care under your plan?

Answers will range from 97% for Kaiser Permanente, a nonprofit that is the nation’s largest HMO, to less than 70% at for-profit HMOs. Remember, if the money is not spent on medical care, it is spent on ads, administration, executive salaries and other overhead.

Q. Under your plan, will my primary care doctor--and physician specialists--be paid the same monthly rate regardless of how much care I need?

Critics say that such capitated payments encourage doctors to under-treat patients. Also, capitated plans pay so little doctors say they are forced to see more patients.

Q. Under your plan, do primary care gatekeeper doctors get more money or bonuses if they deny referrals to specialists, testing centers or hospitals?

If the answer is yes, you should ask the price difference between the basic HMO plan and the insurance company’s next best plan where doctors are paid each time they see you and have a financial incentive to treat you well.

Q. If I choose a more expensive plan, how much more freedom will I have to choose my doctors and how much more freedom will they have to order specialty care without permission from review committees or medical directors?

The fastest growing HMO plan is point of service. It allows patients to go out of their basic HMO network to choose doctors, but they have to pay more of the costs out of pocket and may pay a higher premium, too.

Q. What are the most frequently requested procedures being denied by your HMO as “experimental/investigative” or “not medically necessary”

HMOs are keenly aware of these exclusions and should share them with consumers.

Leading this list are costly organ transplants such as lung, liver, heart and bone marrow, as well as the use of a proton beam to treat prostate cancer. Home health care, including physical rehabilitaiton and skilled nursing, is also often rejected or discontinued after a short time by HMOs. Physician groups that contract with HMOs also routinely reject speecialty treatments such as MRI brain scans, bone scans and blood work-ups.

Q. Do you have an HMO report card I can review to see how your HMO compares to others in preventive care such as immunizations and cancer check-ups?

Consumers and lawmakers are pushing for such comparisons so patients can effectively shop plans.

Q. Do you have a process for an independent review of my case if the HMO or its provider denies treatment?

Eight states have enacted laws or rules forcing independent review of denials upon patient request. This year even HMO groups are backing such a review as an alternatie to allowing patients to sue HMOs for damages.

Q. How much would you pay my primary doctor for taking care of me?

HMOs usually pay small per-patient per-month fees of about $10 to primary doctors. These fees very depending on the age of the patient and whether the doctor also pays for specialty care and hospitalization out of that fee.

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How to Make the HMO System Work for You

Problem: My doctor has left my HMO provider network, and I’ve been stuck with one I don’t want. How can I get a doctor of my choice?

Solution: Write a letter to the medical director of the physicians group that provides your care, explaining the reason you want the change. Follow up with a phone call. If you need to change immediately, call your case manager at your insurance company. Be persistent.

Problem: My family member is being discharged from the hospital too soon.

Solution: Call the primary treating doctor immediately to discuss your concerns. Ask the doctor to put the reasons for the discharge in writing. For information and assistance, contact the case manager at your insurance company, a hospital social worker involved in the case and speak to the nurses who have provided care. Bargain for more days.

Problem: My doctor runs in and out during my office visits, and I never get enough time for proper care.

Solution: List your concerns before your next appointment, and send them to your doctor. Call your doctor’s office and let scheduler know you will need more time at your next visit.

Problem: I’m dissatisfied and want to change my health plan from an HMO to PPO.

Solution: Contact your employer and check for open enrollment period--but it’s usually only once a year. Then call your insurance company and ask for your case manager and explain why you want the change. Get you employer involved. Exceptions have been made.

Problem: I have a serious medical problem that my primary doctor can’t diagnose. I need a specialist. And I’ve heard of a good one. How do I get a second opinion outside my HMO-approved network of specialists?

Solution: Tell your primary care doctor that you’re not satisfied and say why. Since you must see specialists within your HMO-contracted network first, make appointments with them back-to-back. If the problem is still undiagnosed, appeal to the network’s medical director and its utilization review committee. Write each committee member and talk with each. Call to get committee’s decision, and start appeal process immediately if denied. Never give up until you’re satisfied.

Problem: A prescription drug has been very effective for me, but the drug is no longer covered by my insurer’s plan.

Solution: Under a new state law effective Jan. 1, you can continue to take the same medication even after it is discontinued by your plan. Until then, you can appeal to the prescription plan (the telephone number is on the back of your insurance care, or prescription plan card). You can also ask your doctor to appeal on your behalf, since the physician knows how the drug’s effectiveness for you. Also, ask your pharmacist about the difference between the original drug and the substitute. The Internet has similar information. Finally, ask your doctor for samples of the discontinued drug until your appeal is resolved.

Source: Patient Advocacy Management Inc.

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Patient Satisfaction by Location

Ventura County households are generally more satisfied with their health care than counterparts across the state, but less so than households nationally. Local and state residents are more pleased with health insurance costs. HMO penetration locally is 53.5% of households (42.4% of population), compared to 65.1% of households statewide (50% of population) and 38.8% of households nationally (29.6% of population.)

% Completely or Very Satisfied: Overall Satisfaction

County: 56.1%

State: 58.5%

Nation: 58.2%

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% Completely or Very Satisfied: Overall Satisfaction with Care

County: 62.2%

State: 60.5%

Nation: 62.5%

*

% Completely or Very Satisfied: Access to Needed Care

County: 62.4%

State: 59.9%

Nation: 63.1%

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% Completely or Very Satisfied: Ease of Choosing a Personal Doctor

County: 55.6%

State: 55.1%

Nation: 60.6%

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% Completely or Very Satisfied: Access to Needed Specialty Care

County: 62.5%

State: 56.4%

Nation: 61.8%

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% Excellent or Very Good: Types of Services Covered

County: 62.3%

State: 57.6%

Nation: 57.5%

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% Excellent or Very Good: Cost to Belong to Plan

County: 50.0%

State: 51.7%

Nation: 46.3%

*

% Excellent or Very Good: Out of Pocket Expenses

County: 53.1%

State: 52.0%

Nation: 45.0%

*

% Definitely or Probably: Would Recommend Plan to Friends

County: 81.4%

State: 81.3%

Nation: 81.8%

*

% Definitely or Probably: Don’t Intend to Switch to Plans

County: 79.4%

State: 82.1%

Nation: 83.1%

Source: National Research Corp, 1997 poll.

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Patient Satisfaction by Health Plan

Ventura County households are generally more satisfied with their health care when it is provided by traditional fee-for-service plans or Preferred Provider Organization plans. They offer greater freedom when choosing primary physicians and specialists, but at a higher price. Patients enrolled in HMO plans are more satisfied with health insurance costs. In fact, a higher rate of fee-for-service and PPO enrollees intend to change plans than do those in HMO plans.

% Completely or Very Satisfied: Overall Satisfaction with Plan

FFS: 73.1%

PPO: 63.9%

HMO: 55.6%

*

% Completely or Very Satisfied: Overall Satisfaction with Care

FFS: 77.8%

PPO: 70.7%

HMO: 61.7%

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% Completely or Very Satisfied: Access to Needed Care

FFS: 66.3%

PPO: 80.5%

HMO: 55.8%

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% Completely or Very Satisfied: Ease of Choosing a Personal Doctor

FFS: 65.9%

PPO: 75.1%

HMO: 55.8%

*

% Completely or Very Satisfied: Access to Needed Specialty Care

FFS: 64.5%

PPO: 77.0%

HMO: 52.3%

*

% Excellent or Very Good: Types of Services Covered

FFS: 64.4%

PPO: 76.3%

HMO: 56.3%

*

% Excellent or Very Good: Cost to Belong to Plan

FFS: 41.7%

PPO: 39.5%

HMO: 55.5%

*

% Excellent or Very Good: Out of Pocket Expenses

FFS: 58.0%

PPO: 42.9%

HMO: 58.2%

*

% Definitely or Probably: Would Recommend Plan to Friends

FFS: 83.5%

PPO: 83.7%

HMO: 82.3%

*

% Definitely or Probably: Don’t Intend to Switch to Plans

FFS: 75.7%

PPO: 81.8%

HMO: 82.4%

Source: National Research Corp., 1997 poll.

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Patients’ Bill of Rights

Sensing consumer frustration, proposals championed by President Clinton, Gov. Pete Wilson and a host of lawmakers are wending their way through Congress and the state Legislature that would establish a patients’ Bill of Rights. Among those are:

* The right to greater access to physician specialists

* The right to appeal HMO decisions restricting care to independent boards.

* The right to sue HMOs directly for poor medical treatment.

* The right of women to have gynecologists as their primary care doctors. A new state law will guarantee this beginning next January.

* The right of new mothers to stay in the hospital for 48 hours after birth, instead of 24 or less as was sometimes encouraged until new laws prevented such “drive-through” deliveries.

* The right to more information from HMOs about the cost and quality of health care so plans can be more easily compared.

* The right to compare health plans using national standards for quality of care.

* The right of patients to be told all treatment options by your doctor, even the more costly ones that the doctor may not favor. Thirty-two states have already passed such laws.

* The right to know in detail what drugs are approved for use by an HMO before signing up for that health plan.

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About This Series

“The HMO Backlash” is a three-day series examining how the people of Ventura County have fared in the managed-care revolution of the last decade. Today’s stories detail how lawyers, doctors and patients are pushing for reform and finding ways to circumvent the constraints of HMO medicine. Earlier pieces described how some doctors are rebelling against the HMO system and others are making it work.

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‘Managed-care groups have castrated doctors, really. You either sign the contract or hit the road, Jack.’ Dr. Claudia Jensen, Ventura pediatrician.

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‘Trying to figure out what’s happening in health care these days is like trying to piece together a jigsaw puzzle.’ Pat Powers, Pacific Business Group on Heath.

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‘Patients are being harmed, and that hurts me. We’ve all got to take a stand against these contracts that pit doctors against their patients.’ Kenneth Saul, Thousand Oaks pediatrician.

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‘When you choose your health-care plan, it can be the difference between life and death.’ Pamela Hasner, Patient advocate.