01/16/1998 09:00 AM Senate HES

                                                                               
          SB 197 - REGULATING HEALTH MAINTENANCE ORGS.                         
                                                                               
CHAIRMAN WILKEN called the Senate Health, Education and Social                 
Services (HESS) Committee to order at 9:06 a.m.  Present were                  
Senators Wilken, Ward and Leman.  Chairman Wilken announced the                
first order of business was to continue taking public testimony on             
SB 197, which would also be heard in committee on Wednesday,                   
January 21, at the sponsor's request.                                          
                                                                               
GORDON EVANS, representing the Health Insurance Association of                 
America (HIAA), clarified HIAA's position on SB 197.  In previous              
testimony, Mr. Evans stated that HIAA believed SB 197 is                       
unnecessary; opposed Section 2 which mandates certain benefits for             
chiropractors;  and did not oppose the provisions in Sections 1 and            
3.  HIAA believes Section 1, which proposes to amend current law to            
require a carrier to include, in its evidence of coverage,                     
guidelines explaining when treatment may be denied, is unnecessary             
because managed care plans are currently required to file a                    
Schedule of Benefits with the Division of Insurance when                       
establishing plans in Alaska.   The Schedule of Benefits, which is             
provided to encourage active enrollment, is a legal document that              
describes in detail what the plan does and does not cover, and                 
rules and procedures governing eligibility.  Instead, HIAA would be            
willing to provide to the patient or health care provider, upon                
request, a written explanation of an adverse determination.                    
                                                                               
Regarding Section 3, MR. EVANS said three of the five parts impose             
limits on communication between a health care provider and the                 
enrollee, and require written notification of cause for termination            
of a health care provider.  HIAA believes those provisions are                 
contractual matters.  Most managed care firms guard their current              
customers and information about their plan for purposes of                     
confidentiality.  Consequently, plans will include contractual                 
provisions asking the health care provider to agree to not                     
disparage the health plan to enrollees or attempt to induce the                
enrollees to leave a plan or join another.  These types of                     
contractual provisions are not unique to HMOs; they are imposed by             
other employers through contracts or employment manuals: no                    
business can tolerate its employees driving customers away.  As the            
general contractor employing the provider, health plans could be               
held jointly liable for libelous statements by a provider or                   
spurious claims which may impact another provider's business.                  
Also provider's who might have multiple contractual arrangements               
with health facilities and plans could attempt to steer patients to            
facilities in which they have a personal financial interest.                   
Finally, the medical community has protected itself against                    
disclosure of data which compares physicians and facilities  based             
upon clinical outcomes.  The same level of analytical objectivity              
should be required in any qualitative statements made by physicians            
who are in a contractual relationship with an HMO.                             
                                                                               
MR. EVANS read part of the written testimony he submitted for the              
committee file and concluded his remarks by saying insurers should             
not be required to subject every denial of health care coverage to             
a second provider's opinion.  HIAA always opposes mandating                    
benefits because that practice will drive up costs and ultimately              
limit the affordability of quality care for consumers.  Mr. Evans              
stated he would be willing to work with the sponsor on changes to              
SB 197 that HIAA could support.                                                
                                                                               
Number 140                                                                     
                                                                               
SENATOR WARD asked if the sponsor requested that SB 197 be held in             
committee.  CHAIRMAN WILKEN repeated the bill would be held until              
Wednesday at the sponsor's request.