Patients Testify In Support of Legislation Designed to Provide ‘Continuity of Care’ When HMOs And Medical Groups Terminate Contracts

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Consumer Group Supports A Davis Administration Plan Designed To Protect Patient Choice; Proposal Includes Access to Vital Medical Records

Sacramento- The Foundation for Taxpayer and Consumer Rights is engaging in a final push to guarantee that patients do not lose access to their physicians or face disruptions in their health services when their insurers change networks. The growing threat to California consumers is that when HMOs, health insurers, or doctors terminate or fail to renew their business contracts, patients may face lapses in their health care benefits. Such contractual changes jeopardize access to primary care physicians, specialists and hospitals for hundreds of thousands of Californian’s each year. New proposals by the Davis Administration and the Department of Managed Health Care (DMHC) as well as two legislative initiatives would add new ‘continuity of care’ protections to California’s Patients’ Bill of Rights law.

“Hundreds of thousands of Californians are at risk of losing access to their physician of choice and face disruption in health coverage as a result of HMO decisions to terminate contracts with doctors and hospitals,” said Jerry Flanagan, a Consumer Advocate for the Foundation for Taxpayer and Consumer Rights. “No consumer should be at risk for losing access to their vital health records as a result of contract terminations or medical group bankruptcies. HMOs should share the burden of ensuring that a patient’s new doctor has access to all medical files.”

HMOs and other health insurers commonly terminate contracts with doctors, medical groups and hospitals as a result of increasing health care costs, changes in an insurer’s geographic region, and disputes over reimbursement for care with health care providers. As a result of these contract terminations, patients are forced to change physicians, medical groups, or hospitals with little notice — a circumstance often resulting in disruptions in health care services. The DMHC has proposed several new ‘continuity of care’ protections including a requirement that HMOs and other health insurers allow an enrollee to retain access their primary care physician, specialist and hospital of choice for up to 1 year after contracts are terminated or are not renewed. In addition, the DMHC proposal would:

– Expand existing law to ensure that when children between the ages of 0 and 3 loose their doctor as a result of contract terminations, they can remain with their doctor for 90 days;

– Expand existing ‘continuity of care’ law for patients undergoing treatment to include all pregnancies, care for the terminally ill until the end of life, and all patients with scheduled treatment;

– Require insurers and medical groups to share responsibility in transferring a patient’s medical records when contracts are terminated or a bankruptcy occurs.

Consumer advocates have long held that a ‘continuity of care’ proposal must allow patients to retain their existing health benefits for an entire year after notification of contract terminations. By allowing a one-year grace period, a consumer would be assured that there would be no disruption in health care services. Further, patients would have sufficient opportunity to choose between purchasing a new health insurance package in annual “open enrollment” periods — during which health insurers accept new enrollees — or continue with an existing health plan.

“This is an issue of consumer choice,” said Flanagan. “Patients deserve to have the time to choose a new health care insurance package that is right for them. Consumers should not be locked out of their health care benefits when HMOs choose to terminate contracts with doctors and hospitals.”

Some of the key concepts of the DMHC proposal are embodied in two legislative initiatives debated by a Conference Committee today in the State Capitol. The bills, Assembly Bill 1522 and Senate Bill 103, authored by Assembly Member Helen Thomson and Senator Jackie Speier respectively, have been deadlocked in the State Legislature since the end of the 2001 legislative session due to policy differences. Consumer advocates expressed optimism that today’s conference committee debate marked the denouement of the process to make the proposed protections law.

“Continuity of care is too important for California patients to languish in legislative deadlock,” said Jerry Flanagan of the Foundation for Taxpayer and Consumer Rights. “We are hopeful that Assembly Member Thomson and Senator Speier will embrace DMHC’s proposal.”

For more information on the Foundation for Taxpayer and Consumer Rights, please visit our website at

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Consumer Watchdog
Consumer Watchdog
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