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Jan 29, 2004 - 12:30 PM

The Eraser of HMO Patients' Rights?

by Jamie Court
HMO reform was the big populist movement of the late 1990s and, in California, one of its main results was a new Department of Managed Health Care and its 1-800 patient help hotline. The Department has effectively helped patients denied care by intervening on their behalf and established new rules for HMOs to follow. Now some of those important rules may be on the chopping block. That's a result of California's "populist" governor's order to identify all rules, advice, bulletins, guidance, and criterions not developed through official rulemaking proceedings for possible rollback.

ArnoldWatch has obtained the Department of Managed Health Care "Underground Regulations Assessment," pursuant to Schwarzenegger's executive order. The array of rules for HMOs to follow that could be crushed by the Gov are troubling and include these:

HMOs cannot deny benefits retroactively and must give a 15 day cancellation notice.
No HMO can stop covering an entire class of drugs when one drug in the class becomes available over the counter.
HMOs must respond to patient grievances in writing within 5 days.
HMOs must follow standards for treatment for patients with phenylketonuria (PKU).
HMOs must cover emergency contraception dispensed by a pharmacist.
Co-payments charged a consumer under a health plan shall not exceed 49 percent of the cost of the service.

(The complete list of DMHC guidelines that are in limbo is available at

All the identified rules carry out the spirit and letter of statutes. To revoke them now would mean more pain and frustration for patients and a boon for HMOs, whose reform in 1999 was driven by the HMOs' tendencies to put money over medicine. If Arnold revokes these rules he will be guilty of the same sin. Schwarzenegger has received $31,200 from Pacificare and $21,200 from WellPoint executive Dennis Weinberg and Arnold's Chief of Staff is the former lobbyist for the HMO HealthNet, which recently gave $21,200 to the Gov. ArnoldWatch tipsters tell us that the lack of direction at the Department of Managed Health Care under this governor is already leading to regulatory aimlessness. In the realm of HMOs, such gubernatorial neglect will mean that HMO patients will face more pain, suffering, and, in the worst cases, needless death.

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