When HMO Customers Want a Second Opinion
Consumer groups and HMO members have long complained about the lengthy ordeal some patients encounter when they appeal a health plan’s decision to deny medical treatment. Consider that the appeal process often takes place in the midst of a medical crisis, and the process becomes more daunting.
Even some HMO officials concede that, sometimes, frustrated consumers just give up the fight.
People who do persevere find out that the health plan usually has the final say. Yes, it is possible to appeal a denial to regulators--in California, that’s the state Department of Corporations--or to take the health plan to court or to private arbitration. But only a handful of people do.
Now there is growing support for the idea of guaranteeing patients the right to an external appeal of an HMO’s decision.
Both Democrats and Republicans in Congress are supporting some form of external appeal. In Sacramento, similar bills championed by Sen. Herschel Rosenthal (D-Los Angeles) and Assemblywoman Carole Migden (D-San Francisco) are working their way through the Legislature. The California Assn. of Health Plans, the HMO trade group, has supported the concept of external appeals, but only for claims above a certain dollar amount to discourage frivolous actions.
“There’s a major effort in the Legislature to review a number of external review bills,” said Michael Shapiro, a senior aide to Rosenthal. “It’s a high priority for the governor’s office and the health plan industry.”
The federal government is looking at ways to enhance external appeals for Medicare and Medicaid patients, the government medical insurance plans for the elderly, disabled and poor.
As that debate continues, one HMO, Woodland Hills-based Health Net, has tried to jump ahead of the Legislature by announcing its own external appeals process.
Starting last month, Health Net, one of the state’s largest health plans, said it would speed up its appeals process and guarantee that members could seek an outside review of any denied appeal.
In the past, appeals often would take 60 days or so to work their way through both the patient’s doctor and the HMO itself. The HMO promises to cut that period to 20 days, said Mary Gilligan, a Health Net senior vice president.
Health Net receives about 100 to 130 appeals a month, she said. She claims that about 50% to 60% of the time, Health Net ultimately sides with patients and overturns treatment denials.
More significantly, Health Net said that patients whose appeals receive a final “no” from the HMO will have the right to demand review by an “independent third party.” The appeals will be heard by two private medical review organizations chosen by Health Net.
Health Net also said there would be no dollar limit--such as $1,000 or $2,000, for example--for appeals.
Peter Lee, a director with the Center for Health Care Rights, a patient advocacy group, called Health Net’s appeals program “a significant advancement.”
Independent review is “good medicine because it resolves issues more quickly and means people get access to care faster,” Lee said. Besides fewer angry patients, HMOs benefit by gaining an extra layer of protection for any cases that wind up in court or arbitration.
“A lot of times people would drop out of the process because it was too complicated,” said Gilligan. “That can drive people to drop out of the plan, and it can drive a lot of bad press.”
Indeed, one reason HMOs are slowly warming to the idea of external review is to head off legislation they consider more draconian. Pending federal and state legislation would give patients the right to sue their health plans for malpractice, for example. Under current law, most plans are exempt from malpractice suits.
While HMOs have contended in the past that external review would be too costly, a new study by the Kaiser Family Foundation found that such a program would add only 3 cents a month to the average medical premiums for Californians.
Lee, who heads a pilot ombudsman program for HMO members in the Sacramento area, questioned one aspect of Health Net’s plan. Ideally, he said, the health plan should not be able to pick which review agency it sends appeals to because it raises questions about the independence of that review.
Lee also said it is important that any outside appeals program “provide an opportunity for consumers to make their case” directly to the review agency. “The consumer needs to know the basis for denial, what factors were considered and have the opportunity to respond.”
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Staff writer David Olmos can be reached by e-mail at david.olmos@latimes.com, or by fax at (213) 237-7837.
