SACRAMENTO -- Senator Liz Figueroa (D-Fremont) today continued her 
leadership role in HMO reform by introducing a bill that would close a 
key loophole HMOs have used to increase their profits at the expense 
of doctors and patients.  

SB 1746 requires HMOs to notify patients whenever the HMO terminates 
the contract of a doctor.  While this appears to be a minor change in 
the law, it will have significant consequences for patients and their 
doctors.  Under most HMO contracts, patients are required to have a 
"gatekeeper" doctor who controls the patient's care.  HMOs pay the 
doctor (or his or her medical group or independent practice 
association (known as an IPA)) a set monthly fee whether that patient 
uses the doctor's services or not.  However, HMOs frequently terminate 
contracts with doctors, medical groups or IPAs, and most patients have 
no idea this has occurred until months or even years later.  During 
that time, the HMO keeps any dollars they would have paid to that 
patient's doctor, medical group or IPA until the patient discovers 
their doctor is no longer associated with the HMO. 

Figueroa's bill would prohibit this by requiring HMOs to notify 
patients of the termination within 30 days.  If the HMO does not 
provide proper notice and the opportunity for their enrollee to choose 
another gatekeeper, the HMO would waive its right to have a gatekeeper 
make referrals to specialists for that patient, and would also waive 
any copayments the patient would otherwise have to pay for emergency 
services.

"HMOs have figured out a way to profit off of their own decision to 
terminate doctors," Figueroa said.  "When an HMO's economic choice 
comes at the expense of patients and doctors, it has to be stopped, 
and that's what this bill would do."

SB 1747 is sponsored by the Union of American Physicians and Dentists.  
UAPD's president, Dr. Robert L. Weinmann, was enthusiastic about the 
bill.  "Up to now," Dr. Weinmann said, "too many patients find they 
don't have a doctor in the very plan to which they're paying premiums.  
Senator Figueroa's bill corrects this and makes sure that people get 
the information they need."

Capitol Office:
State Capitol, Room 2057
Sacramento, CA  95814-4906
(916) 445-6671
(916) 327-2433 FAX
 

District Office:
43271 Mission Blvd.
Fremont, CA  94539
(510) 413-5960 or (408) 286-0329
(510) 413-5965 FAX
 

E-Mail:
senator.figueroa@sen.ca.gov

Website:
www.sen.ca.gov/figueroa