Regulating HMOs is a bruising job

Times Staff Writer

At a hearing on a long-running billing feud pitting physicians against health insurers, a blustery trauma surgeon queued up for his turn at the podium.

He was one of dozens of busy specialists from around the state who cleared their calendars for the day so they could lecture the government official in the black suit on the dais in a Burbank hotel conference room.

The surgeon’s face turned red with anger as he let Cindy Ehnes, executive director of the state Department of Managed Health Care, have it. California’s trauma system will collapse, he warned, unless her agency starts forcing insurers to pay all their members’ emergency room bills.

“The DMHC,” he went on, “has failed to police the insurance industry.”


That’s a typical day in the life of the only state regulator charged exclusively with supervising health maintenance organizations -- arguably one of the most thankless jobs in government.

In one of his displays of bipartisanship, Gov. Arnold Schwarzenegger, a Republican, appointed Ehnes, a Democrat, nearly four years ago. She oversees a department with 330 employees and a $34-million annual budget that supervises 121 health plans with 21 million members.

Getting tongue lashings from the public isn’t in the official job description, but it might as well be.

Ehnes (pronounced Ee-nis), 56, spends much of her time refereeing heated battles involving at least two -- but often more -- of healthcare’s key constituencies: insurers, physicians, hospitals and patients. And on any given day, at least one of them -- but often more -- is upset with something she has done, or not done.


The day before the hearing in Burbank, the insurance industry took a turn chastising her, this time for a proposal to protect consumers from being unfairly dropped by their health plans after they get sick. The proposed regulations, insurers said, would require them to do more work that would take up time and merely drive up costs for everyone.

Ehnes -- an Ohio native, trained lawyer and mother of two -- says she is not out to win any popularity contests. She says she cares more about doing what she believes is right than being liked. And rejection doesn’t faze her either. She says she got used to it, in fact, when she ran for political office in Colorado several years ago against a beloved incumbent who had recently been widowed.

Even though nobody gave Ehnes a chance, she went knocking on doors. If prospective voters had merely slammed their doors on her, that would have been easy. Instead, most thought they had to give her a piece of their mind first.

“They ripped me,” she says. “It was, ‘How dare you run against our Phil? He just lost his wife, and you are putting him through this?’ ”


In the end, Ehnes closed in on the popular incumbent, losing by a hair. She never ran for office again. But she came away with a lesson that still serves her.

“I learned that it doesn’t kill you; you don’t die because of people’s displeasure,” she says.

Ehnes says she takes her role as a consumer advocate seriously. She says her desire to help others took root after she lost her left hand in an on-the-job accident during her sophomore year in college. She lost a ski-racing scholarship to Idaho State University, but she was determined to finish college.

Ehnes also was a paid member of the women’s ski team sponsored by cosmetics maker Bonne Bell. She was sure they too would drop her after the accident. But they kept her on -- skiing with one pole -- a decision she calls surprising for its day. She also joined the U.S. Disabled Ski Team, ably touring the world until she was 31, when she and her husband decided to have a family.


The following year, she had the first of her two daughters.

After the accident, Ehnes knew she wanted to be a lawyer.

“I saw it as a way to give voice to ordinary people,” she says. “I wanted to be the person who would help.”

That’s how she feels about her job now.


“If I don’t have the guts to step into it, how can I say we’re protecting patients?” she says.

Sometimes protecting patients and helping health plans are the same thing, she says. A case in point was presented by the growing tendency of health plans to file for licenses to sell new types of coverage with the Department of Insurance, where the rules about what constitutes health coverage are less stringent.

Ehnes wanted to stanch that trend. She thinks consumers are better served by the minimum benefit requirements that her department is charged with maintaining. So she directed her staff to streamline the license review process.

Health plan officials are cautious in what they say about Ehnes publicly. But Chris Ohman, head of the California Assn. of Health Plans, says she reduced “unnecessary red tape and expedited the government review process.”


Although Ehnes views herself as a patient advocate, consumer groups don’t always agree.

For example, Ehnes was the first regulator to take on the health-plan practice of dropping policyholders after they get sick. In addition to proposing new rules, she sought fines -- including $1 million from Blue Cross of California -- for alleged rescission violations.

But consumer groups say the proposed rules fall short and the fines are too small to matter to big health plans.

Physicians also say she goes too easy on health plans accused of breaking rules on doctors’ fees, billing and collections.


“We have been disappointed,” says Richard Frankenstein, president of the California Medical Assn.

Lt. Gov. John Garamendi -- who worked in tandem with her in his previous post as insurance commissioner -- says Ehnes’ heart is in the right place.

“She was always concerned about the consumer,” Garamendi says. But “she didn’t always have the freedom to act as aggressively as she wanted.”




Administering care

Who: Lucinda “Cindy” Ehnes


Age: 56

Job: Executive director, California Department of Managed Health Care

Best advice for HMO patients: The HMO Help Center, (888) HMO-2219, or (888) 466-2219, will help you get the right care at the right time.

Hobbies: Skiing, dance, hiking and, since Christmas, Wii sports


Favorite ski run: Among others, the Headwall at Squaw Valley -- steep, fast.

Personal: Bachelor of arts degree from George Washington University; law degree from Columbus School of Law. Both schools are in Washington. Has two grown daughters; lives in Fair Oaks with husband Jack Ehnes.