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Hasta La Vista HMO Regulation?

by  Jamie Court, author of Corporateering
November 25, 2003 - 3:10 PM

Capitol insiders are abuzz with news that Governor Schwarzenegger is considering eliminating the four year old Department of Managed Health Care in the interest of "efficiency" and "consolidation." The rumor mill has it that HMO regulation will be returned to financial bureaucrats at the Department of Corporations - the very same securities lawyers who botched the job during the Wilson Administration.

The only bipartisan agreement on California HMO reforms in 1999 was that the Department of Corporations, because of its business bent, was not able to adequately police HMO medicine or to respond to patients as a dedicated consumer protection agency would. Under the Department of Managed Health Care, a rapid-response, 24 hour complaint hot line has made HMOs pay for more care than they like. That may be why the Corporations idea is back. . . Remember Arnold’s Chief of Staff was formerly the top lobbyist for the HMO Health Net. And California's Department of Managed Health Care levied a $100,000 fine on Health Net in 2001 for failing to pay physicians on time, the second-largest penalty for such a violation.

Then again the disappearing Department may just reappear.... That's what happened to the vanishing on-line labor rights manual ArnoldWatch uncovered on Friday as a sign the pro-business administration was denying workers the tools to protect themselves. By Monday afternoon, after complaints from labor unions and inquiries from the press, Schwarzenegger's Administration said it would return the documents to the Internet, claiming they were a mistaken casualty of the regulatory freeze.


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