San Diego is actually at the epicenter for the development and wide scale application of the policies implemented under what has been referred to as “Managed Care,” which is the system now in place for those of you who have health care coverage, group or individual, that covers you and your family. The original idea was that costs associated with the medical treatment doctors were charging was too high. So the Health Care Insurance Industry started placing requirements that required various medical tests, treatment and even surgical procedures under the review of their employees, most of them not even medical doctors or formally medically trained to assess whether the doctor’s recommendation should in fact be followed. Now you would have some independent contractor who is compensated based on what they save the company, deciding whether the patient really needs the M.R..I. prescribed, or the surgery recommended.

This started having significant results, however, the medical providers were upset about having their decisions reviewed by unqualified individuals. The Health Care Insurance Industry then came up with the brillant idea of compensating the medical providers by the amount and treatment they didn’t provide. Called Non-Utilization Bonuses, hospitals and medical providers started receiving huge amounts of money when they achieved targets set by the Health Insurance Industry for the treatment that they opted not to provide.

The next step was the way that medical providers were paid for services provided under the Health Insurance Contract. The major health insurance carriers negotiate with each hospital and medical group that would like to be covered as an authorized provider for the unions, employers and other groups that have paid premiums for their members to be covered under. The medical provider agrees to provide various services at a reduced or capitated rate, below the amount listed or authorized as the reasonable charge in C.P.T. codes (published lists of accepted fees for specific medical procedures). To offset the discount that the providers have agreed to, in order to gain access of the subscriber of a particular health plan, the insurance carrier also pays them a fee based on the total amount of the subscribers who would be potential patients if they ever became ill or injured. The hospital and medical group, selected by the subscriber, when they sign up for the coverage, is paid every month whether they ever see any of the enrollees or not. The kicker is that if a covered individual actually has to receive medical care then the facility agrees to absorb the amount of their care up to a certain limit. It can range from just $5,000 up to $100,000. The medical group takes the risk that only a small percentage of the potential enrollees who select them will ever actually require medical care that they have to provide but will not be compensated for. That’s one of the reasons why when a person selects a medical group they are required to sign a form that requires the medical group to be reimbursed for the cost of the medical care provided in the event that the patient has been injured through the fault of another. The reimbursement requirement does not offset the cost of the premiums that the patient has previously paid. It also can be required even though there is inadequate insurance coverage for the individual who is responsible for causing the patients injury and need for medical attention.

This system actually encourages medical providers not to treat their patients. It’s the reason why patients are sometimes told that their treatment is not covered when it’s needed due to an accident. That is absolutely untrue, there is no health care coverage that does not apply when needed due to trauma, whether the patient has a claim or not. Patients are also discouraged from receiving appropriate referrals to specialists, or having M.R.I.. testing to diagnosis whether the nerve pain experienced is due to protrusion from a herniated disc, or physical therapy that continues until the patient has fully recovered, if improvement is happening. Not just an arbitrary amount of sessions authorized regardless of actual results.

Unfortunately, these problems have permeated and undermined the quality of the medical care available today. A person who receives medical coverage as a benefit of their employment or who pays their own premimum should not have to worry that their medical provider is influenced by the contract they’ve entered into with the patient’s health care insurance carrier. It is critical that patients refuse to be ignored or mistreated when their medical complaints are not properly diagnosed and treated. Attorney Gary Sernaker has been protecting the rights of his clients to fight for their right to receive the quality of care that they have paid for are entitled to. If you feel that your medical group is not doing what is necessary for you to recover from an injury please contact him for a free consultation.

Photo Credits: Mercy Health, Flickr.