News in brief - July 11, 2005

AMA house recommends physicians look at catastrophic care costs - AMA to study referrals within health systems - AMA to teach evidence-based medicine - Kaiser fined for privacy breach - McKesson acquires Medcon

AMA house recommends physicians look at catastrophic care costs

Physicians will be urged to become more involved in developing and implementing cost-containment strategies under a new American Medical Assn. directive aimed at helping to reduce catastrophic care costs.

Delegates to the AMA Annual Meeting in June adopted the recommendations of a report that examined the complexities of catastrophic care costs, focusing on the most expensive 5% of patients.

The report found that 5% of patients accounted for nearly half of all health care expenditures in a given year. Aggregate spending for the 10 most-expensive medical conditions totaled nearly 50% of all health expenditures.

The report urged physician involvement in strategies to contain the costs, particularly strategies directed toward the most expensive patients. It also recommended additional research into the characteristics of those patients.

Finally, the report called for greater evaluation of the use of disease management, case management, pay-for-performance and end-of-life care programs for high-cost patients.

It said evidence suggests that programs such as disease management can improve quality of care, but the overall impact on costs hasn't been demonstrated.

AMA to study referrals within health systems

The American Medical Assn. will take a hard look at referrals within integrated health systems and might recommend new policy, legislation or regulations based on findings.

Delegates at the AMA Annual Meeting in June called for a study to see if there are anti-competitive or ethical implications to the expectation that referrals stay within an integrated health system's physician group, whether or not those expectations are explicitly communicated or rewarded.

The study will focus on situations in which there is a choice among equally competent, competing physicians, and the choice is not inhibited by insurance coverage restrictions.

Delegate Steven Kanig, MD, a nephrologist from Albuquerque, N.M., said such expectations could force physicians employed by the systems into a conflict of interest, and therefore an ethical jam. But the situations also can raise legal issues because of concerns about anti-competitive behavior.

Dr. Kanig, whose New Mexico delegation introduced the proposal, said the resolution was not intended to try to put a stop to physician referrals within integrated systems. "It is intended to stimulate development of guidelines," he said.

AMA to teach evidence-based medicine

The American Medical Association's House of Delegates passed a resolution that the AMA, working with state medical associations, specialty societies and other medical organizations, will "educate" various bodies about "the uses of evidence-based medicine and the dangers of cost-based medicine."

The education, aimed at CMS, state legislatures and state Medicaid agencies, would focus on the definition of evidence-based medicine as that which improves the quality of care for patients. The resolution was introduced because of concerns that insurers and others were equating "evidence-based medicine" with the least-expensive medicine, regardless of quality of care.

The resolution also asks the AMA, through its Council on Legislation, to work with other groups to develop model state legislation "to protect the physician-patient relationship from cost-based medicine policies inappropriately characterized as 'evidence-based medicine.' " The legislation then would be disseminated to state medical associations through the AMA's Advocacy Resource Center.

Kaiser fined for privacy breach

On June 20, the California Dept. of Managed Health Care fined the Kaiser Foundation Health Plan $200,000 for breaching the privacy of approximately 150 patients when it posted their health information on the Internet without their authorization.

The size of the fine reflects the state watchdog agency's concerns that Kaiser allowed the information to be publicly accessible on a Web site for four years and did not remove the data until a former employee filed a complaint with the U.S. Dept. of Health and Human Services in January, according to a statement by DMHC.

The agency also was concerned that Kaiser did not report the breach to state regulators until after the breach was reported in the media in March.

The breach came to light when Elisa D. Cooper, a blogger who was fired by Kaiser in 2003, posted a link to Kaiser's Web site on her own site and filed a privacy violation with HHS.

McKesson acquires Medcon

McKesson Corp. announced June 20 that it had agreed to acquire Medcon Ltd., an Israeli company that sells a Web-based cardiac image and management information system. The purchase price was $105 million. San Francisco-based McKesson said the proposed acquisition would boost its position in the hospital and health system imaging market. The company sells administrative and clinical software to physicians and hospitals.