Buffalo HMO network drops physicians it battled with

Members of Univera Healthcare in New York have received letters telling them services provided by former Promedicus doctors will no longer be covered.

By Mike Norbut, amednews staff. June 16, 2003.

In the latest chapter of the battle between a Buffalo, N.Y., HMO and a bankrupt physician group, Univera Healthcare has dropped 32 former Promedicus Health Group physicians from its network, telling members they will not be covered for services if they see those physicians after June 27.

The physicians make up eight practices that have formed since Promedicus filed for Chapter 7 bankruptcy Jan. 8. Many used to staff Univera-owned Lifetime Health Centers on a contractual basis, and some even date back to the HMO's staff model days, when physicians worked in the centers as employees before breaking off with the HMO's consent to form their own group in 1997.

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Univera's letter to patients lists the primary care physicians and ob-gyns in question, and says they are not currently participating with the HMO network. The letter offers coverage exceptions to pregnant women who have entered their second trimester or patients who are receiving ongoing treatment for acute illnesses.

Univera's position is that, even though it did not have a contractual arrangement with the new practices, it continued to pay for services by former Promedicus physicians for a 90-day period after the group's Chapter 7 liquidation filing, during which the bankruptcy trustee could have extended the Promedicus contract.

The letter to patients was a result of the 90-day window closing without an extension.

Physicians, however, say they were led to believe they had been accepted into the network. Lisa Hoffman, MD, an internist and president of the 11-physician Southgate Medical Group, said Univera representatives conducted a site visit within the last few months and had granted billing numbers for her practice.

"We were under the impression we were credentialed," Dr. Hoffman said.

Univera officials provided a copy of its letter to patients, but they declined to comment further.

Univera sent letters to about 5,000 patients, but physicians thought more would be affected based on how many HMO patients they see in their own practices.

Pediatrician Mark Fishaut, MD, estimated he saw more than 2,000 Univera patients, constituting about 35% of his total patient load. He said the only way to keep those patients would be for them to switch insurance plans, which would require lobbying employers to accommodate changes before next year's open enrollment.

"We'll do our best to survive," Dr. Fishaut said. "Starting up any new practice is an expensive endeavor, and losing patients is a blow. But more important than any financial impact is this is affecting the care of children. It is immoral, and it is unethical."

The relationship between Promedicus, which boasted about 95 physicians at its peak, and Univera deteriorated quickly over the last few years.

The disputes largely stemmed from contract issues and led to dueling lawsuits and newspaper ads. Last year, the disagreements boiled over when Promedicus notified Univera it would not continue to staff the six Lifetime centers once its contract expired Sept. 30, 2003. Univera secured a restraining order in late 2002 preventing Promedicus physicians from telling their patients where they were going because the HMO said the doctors were actively soliciting Univera members to leave.

Promedicus blamed its bankruptcy on what it called undermining tactics of the HMO, while Univera called the filing a ploy to destroy the group and enable physicians to start their own practices without completing their contractual obligations to the Lifetime centers. Court battles, including cases against some individual physicians, are continuing.

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