ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, February 9, 1996 TAG: 9602090075
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
DATELINE: RICHMOND
SOURCE: DAVID M. POOLE STAFF WRITER
Does your physician have an incentive to scrimp on your care? There's no way to know for sure.
Financial incentives to limit care are cloaked in managed-care contracts between physicians and insurance companies.
That secrecy would end under a consumer disclosure provision in a hotly lobbied managed-care bill before the Virginia General Assembly. It comes up for a vote today..
The provision would require insurance companies to disclose any and all financial incentives for doctors to limit the amount and types of health care. It would require insurers to explain managed-care concepts such as "capitation" that are revolutionizing the way health care is delivered.
"If most people knew what capitation is, they would probably ask their doctors a few more questions when it comes to referral," said Del. John Watkins, R-Chesterfield County.
A House of Delegates subcommittee voted Thursday to retain the consumer disclosure part of the bill, despite protests from insurance companies.
At issue: the financial incentives that drive health care decisions.
Traditionally, insurance pays doctors for every test or procedure they perform. Critics say this encourages physicians - or at least provides them no disincentive - to run up the tab.
Managed health care, which accounts for about 20 percent of insurance coverage in Virginia, has stopped the rapid escalation of health costs with a whole new set of incentives.
"The goal is quality care, not excessive care," said Reggie Jones, a lobbyist for a coalition of health maintenance organizations.
Under a capitation model, insurance companies agree to pay doctors a set fee for a pool of patients. The fee remains constant no matter how often patients make an appointment. The doctor earns a profit if he can hold the cost of treating the patients below the fee.
Some doctors complain that managed care puts them in the position of cutting corners and hedging on referrals. "Patients may not understand what's available to them under a plan - and not know why," said William Hazel, an orthopedic surgeon from Fairfax County.
Jones said the disclosure provision of the bill could mislead patients, because it focuses on contractual arrangements, not the outcome of care.
"This doesn't go to the issue of quality," he said. "This goes to someone's contract of how you are operating. This is anti-competition."
Lawmakers on the House subcommittee, however, said patients deserve to know about the financial incentives behind their doctors' decisions.
"The insurance companies are fighting it because they don't want people to lay out the brochures from 10 plans and compare them," said Del. Jim Shuler, D-Blacksburg.
The full House Committee on Corporations, Insurance and Banking is scheduled to vote on the consumer disclosure and other provisions in the managed care bill today.
LENGTH: Medium: 61 lines KEYWORDS: GENERAL ASSEMBLY 1996by CNB