By REBECCA KUZINS
If the quality of health care were determined by the number of agencies regulating the industry, Los Angeles would have one of finest medical care systems in the world. More than a dozen government offices federal, state and local oversee everything from licensing hospitals and physicians to safeguarding the cleanliness of your local hamburger joint.
But instead of ensuring that consumers receive top-quality health care, the patchwork of regulatory agencies is riddled with holes that corporations and lawyers can easily slip through.
The weaknesses of the regulatory system became evident in March, when the state Department of Corporations took over MedPartners Provider Network Inc. and placed the ailing company under Chapter 11 bankruptcy protection. MedPartners, an independent practice association, negotiates contracts with managed care companies for 1,000 doctors who provide medical care to 1.3 million Californians.
It may have been able to duck under the eye of regulators because its parent company, MedPartners Inc., is located in Birmingham, Ala. not exactly the Department of Corporations' jurisdiction. The provider network had no administrative employees within the state and all bills were paid from its corporate headquarters.
In the wake of the MedPartners debacle, public pressure has intensified for stronger regulation of the health care industry.
Just about everyone associated with health care agrees that the Department of Corporations has done a poor job of regulating the industry. Gov. Gray Davis has promised to transfer managed care enforcement out of that department; lawmakers and lobbyists are debating numerous proposals aimed at placing regulatory responsibility for HMOs and possibly other types of health care companies in a new agency.
Consolidating oversight responsibilities into a single agency could simplify the current regulatory quagmire. But health care regulation will remain complex because the nature of the industry is complex. Far from a monolithic structure, health care is comprised of physicians, nurses, technicians, hospitals, nursing homes, HMOs, indemnity insurers, and myriad other people and institutions.
The current enforcement scheme has evolved over time and with the participation of the very people and institutions it seeks to regulate and many of those parties are at least as interested in retaining their respective positions as they are in seeking regulatory reform.
"It's a turf war," said Ron Kaldor, a Sacramento-based health care lawyer. "Doctors and hospitals want separate agencies to regulate them. Regulation has always been done a certain way, and doctors and hospitals are worried about the changes. Creating one agency to regulate both doctors and hospitals would be a major structural change. And in the current political environment, you're not only talking about regulating physicians, but podiatrists and other practitioners. Each one has its own ax to grind, its own lobbyist, its own turf."
For reprint and licensing requests for this article, CLICK HERE.