HMO Bill Hits Davis Opposition

The Davis administration indicated Monday that it wants to gut a bill that would allow independent doctors to bargain collectively with health maintenance organizations.

That effectively shuts the door on Assembly-passed legislation that would have exempted doctors from federal antitrust laws.

In its place, the California Department of Managed Care is proposing a voluntary process in which individual doctors and HMOs can submit contract disputes to an outside expert. By contrast, the bill would have allowed doctors to band together and make demands of health plans.

The bill would have required the Department of Managed Health Care to approve bargaining requests. Daniel Zingale, the department’s director, said the state should not be deciding which doctors can negotiate with which health plans.

“Inserting the government in the private contractual negotiations would likely make things worse, rather than better,” Zingale said. “That’s what I would define as overstepping the bounds of government’s role.”

The bill, backed by the California Medical Assn. and sponsored by Assemblyman Fred Keeley (D-Boulder Creek), is strongly opposed by health plans, business groups and some labor unions. They say collective bargaining would allow doctors to fix prices.

Doctors who support the bill say they need more leverage to negotiate with health maintenance organizations, which often use standard, take-it-or-leave-it contracts.

The California Medical Assn. is exploring alternatives that would allow doctors to challenge HMO contracts, perhaps in court or through mandatory arbitration.