In Bureaucracy, Business, Medical, Social commentary on August 12, 2014 at 9:02 pm

A friend of mine–I’ll call him Sam–recently broke his big toe. But Sam has a bigger problem than his big toe.  He’s on Medi-Cal, the California medical plan for the poor.

And if you think the nation’s veterans have it bad, try getting medical care when doctors refuse to honor your insurance.

After breaking his toe while tripping over a bag, Sam went to his regular doctor, a general internist at California Pacific Medical Center (CPMC) in San Francisco.

The doctor examined Sam’s toe and said he was worried.  It was a big fracture, and if the bones didn’t knit together properly, Sam could be in for big trouble.

So he advised Sam to see an orthopedic surgeon. Luckily for Sam, said his doctor, there was one close by in the same office.  The doctor would ask him to check out Sam’s injury then and there.

Unluckily for Sam, he was on Medi-Cal--and the orthopedic surgeon refused to honor his insurance and see him.

Sam’s doctor sent him home, saying, “I’ll try to find someone as soon as I can.”

At home, Sam called Anthem Blue Cross, the private insurance company now providing coverage to the poor under the state Medi-Cal program.

The Anthem representative soon emailed Sam a list of Anthem Blue Cross orthopedic surgeons who would supposedly accept his insurance. He then printed out the list on his computer.

Sam then made another phone call–to the office of Dr. Vernon L. Giang,  Chief Medical Executive for CPMC. There he spoke with an assistant to Dr. Giang.

He explained his difficulties in getting medical care at CPMC. He added that he had obtained a 14-page list of Anthem-Blue Cross-approved orthopedic surgeons who should be willing to accept his insurance.

The assistant said she would gladly check out the list for any doctors affiliated with CPMC. But there was a problem. Sam needed to fax her the information–and Sam didn’t have a fax machine. Nevertheless,

Sam hobbled several blocks to a nearby Kinko’s/FedEx office, which had fax machines.

The next morning, Sam called Dr. Giang’s office.  He reached the same assistant, who told him that the faxed material had come in. The bad news: There wasn’t a single doctor on that list whom she had called who would accept Sam’s insurance.

In addition, some of the doctors were “out of our plan.”   Which meant that even if they had been willing to accept Sam’s insurance, he couldn’t have seen them.

The assistant was polite and sympathetic, but candid: CPMC’s doctors aren’t required to treat any patient whose insurance they dislike. In fact, CPMC cannot demand that they do so, since the doctors who are practice under its name are considered “independent practitioners.”

So Sam aimed higher.  He phoned the office of Dr. Warren S. Browner, the CEO of California Pacific Medical Center.

But he didn’t reach Browner–or even a secretary.

As a rule, when you call a giant corporation and ask to speak with its CEO, this doesn’t happen.  But what usually does happen is that you’re put through to the executive offices. You won’t speak with the CEO, but you’ll usually reach a secretary for him.

And if your message is one that poses legal or public relations disaster for the company, the odds are excellent that you’ll soon get a call back. Not from the CEO (except in rare cases) but from someone deputized to speak in his name–and to probably address your problem.

But, in this case, there was no secretary to answer the phone for Dr. Browner.  Just a message machine.

So Sam left an urgent message, outlining his difficulties in getting medical care from CPMC.

No one from Dr. Browner’s office called him back that day.

Meanwhile, the pain in Sam’s foot was getting worse.  So, later that day, he hobbled into an emergency room of CMPC.

A doctor examined Sam’s foot and ordered several X-rays taken of the broken toe. After examining these, he told Sam what he already knew: The toe was broken. He also warned that if it wasn’t treated properly, Sam could have great pain–such as from arthritis–in the future.

Sam explained how he had been unable to get an orthopedic surgeon to look at his toe. The doctor said he would try to find one who would.

Sam waited in the ER for almost four hours.  When he finally saw the doctor again, the latter seemed embarrassed to give him the bad news. He hadn’t been any more successful than Sam at finding a CPMC orthopedic surgeon willing to treat Sam’s injury.

When Sam asked what he should do, the ER doctor said that “time” would take care of the injury.

The website for CPMC boasts: “At California Pacific Medical Center, our mission is to always give each patient the personal, hands-on attention they deserve.” Unless, of course, all of its doctors in a particular specialty refuse to honor the patient’s medical insurance.


In Uncategorized on January 9, 2011 at 7:46 am

On January 5, 2011, the Mafia got a new competitor in the extortion market.

Blue Shield of California announced it would seek cumulative hikes of as much as 59% for tens of thousands of customers March 1.

As a result, 193,000 policyholders would see increases averaging 30% to 35%, the result of three separate rate hikes since October.

Nearly 1 in 4 of the affected customers will see cumulative increases of more than 50% over five months.

Most policyholders received separate notices for the successive rate hikes. But others got the news all at once because they had contracts guaranteeing their rate for a year.

Michael Fraser, a Blue Shield policyholder from San Diego, learned that his monthly bill would climb 59%, to $431 from $271.

Fraser is self-employed–like many who hold individual policies. Others policyholders aren’t covered by employer plans or have been laid off.

The Blue Shield increases triggered complaints to new California Insurance Commissioner Dave Jones.

Jones, a former Democratic state assemblyman, said the legislature needed to give his agency legal authority to regulate insurance rates the same way it now does automobile coverage.

At present, the commissioner can block increases only if insurers spend less than 70% of premium income on claims.

But the insurance industry-corrupted legislature seems highly unlikely to grant the Insurance Commissioner such authority to protect consumers.

So: How do consumers protect themselves against such predatory behavior?

They do it by turning to RICO–the Racketeer Influenced Corrupt Organizations Act.

Passed by Congress in 1970, this was originally aimed at the kingpins of the Mafia. Since the mid-1980s, however, RICO has been successfully applied against both terrorist groups and legitimate businesses engaged in criminal activity.

Under RICO, people financially injured by a pattern of criminal activity can bring a claim in State or Federal court, and obtain damages at three times the amount of their actual claim, plus reimbursement for their attorneys’ fees and costs.

Consider this selection from the opening of the Act:

“Racketeering activity means (A) any act or threat involving…extortion…; (B) any act which is indictable under any of the following provisions of Title 18, United States Code…Sections 391-384 (relating to extortionate credit transactions) …section 1951 (relating to interference with commerce; robbery or extortion)…section 1952 (relating to racketeering)….”

How does the behavior of Blue Shield legally qualify as extortion?

By repeatedly jacking up premiums, insurers such as Blue Shield and Anthem are endangering the safety of their customers–by, in effect, threatening to deprive them of their ability to secure medical care for themselves and/or their families.

Would such use of RICO in such circumstances be a new and untested means for redressing injuries? Yes.

But it’s essential to remember that the original law proved a completely new way for combating crime.

Prior to RICO, only those directly involved in committing crimes–such as Mafia hitmen, extortionists and drug-peddlers–could be prosecuted. But their superiors who gave the orders and ruled as kingpins of a criminal network couldn’t legally be touched.

After RICO proved successful in targeting Mafia kingpins, it was applied in cases previously unimagined.

In NOW v. Scheidler, (1994), for example, several parties, including the National Organization for Women, sought damages and an injunction against anti-abortion activists who physically blocked access to abortion clinics.

The Supreme Court held that a RICO enterprise does not need an economic motive, and that the Pro-Life Action Network could therefore qualify as a RICO enterprise.

Taking on the wealthy and well-entrenched insurance industry would be no small thing. But there was once a time when the victims of smoking–and the lawyers who represented them–thought it suicidal to take on the tobacco industry.

The first cases brought against that enterprise failed. But, in time, public opinion changed–and tobacco companies found themselves facing not just private lawsuits but the combined might of Attorneys General throughout the United States.

As a result, the tobacco industry is now on the defensive–and under increasing scrutiny and regulation.

The same can happen with the insurance industry. As Andrew Jackson so fervently believed: “One man with courage makes a majority.”


In Bureaucracy, Business, Law on January 9, 2011 at 12:16 am

California residents who might need medical care in 2011 got a jolt on January 5.

That was when San Francisco-based Blue Shield of California announced it would seek cumulative rate hikes of as much as 59% for tens of thousands of customers. These would go into effect on March 1.

Blue Shield said the increases were the result of fast-rising healthcare costs and other expenses resulting from new healthcare laws.

Translation: Blame it all on President Obama for trying to make medical care affordable to American who aren’t millionaires.

In all, Blue Shield said, 193,000 policyholders would see increases averaging 30% to 35%, the result of three separate rate hikes since October.

Nearly 1 in 4 of the affected customers will see cumulative increases of more than 50% over five months.

Blue Shield is not the first insurance company to give the Mafia lessons on extortion.

In 2010, Anthem Blue Cross tried to raise rates as much as 39% for about 700,000 California customers.

This led to national outrage and helped President Obama marshal support for his healthcare overhaul. The insurer was ultimately forced to back down, accepting maximum rate hikes of 20%.

The Blue Shield increases triggered complaints to new Insurance Commissioner Dave Jones.

Jones, a former Democratic state assemblyman, said the legislature needed to give his agency legal authority to regulate insurance rates the same way it now does automobile coverage.

At present, the commissioner can block increases only if insurers spend less than 70% of premium income on claims. Jones’ office said Blue Shield’s March 1 increase was under review.

It seems highly unlikely, however, that Jones’ office will get that needed authority. The legislature is largely owned by insurance industry bribes (i.e., “campaign contributions”).

An October 29, 2010, press release by Consumer Federation of California noted of the-then ongoing race for State Insurance Commissioner:

“Insurance companies are spending a fortune to hand pick their next regulator. The insurance industry has so far pumped $5.7 million into ads attacking the pro-consumer candidate Dave Jones, or promoting Mike Villines, the industry’s choice for Insurance Commissioner.”

The Federation’s press release further notes: “Now, at the 11th hour, the insurers are suddenly funneling millions into TV attack ads aimed at defeating Jones and electing Villines.

“Aware of the public’s disregard for their industry, insurers are funneling their money through big business front groups, like the so-called ‘Jobs PAC.’

“By placing their donations through big business PACs, the insurers allow Villines to posture as a supposedly ‘independent’ candidate….”

Major donors to anti-Jones and pro-Villines campaign advertisements included:

• $1 million dollars from Mercury Insurance CEO George Joseph,
• $1.15 million from Allstate,
• $640,000 from Liberty Mutual Insurance,
• $390,000 from Progressive Insurance,
• $225,000 from Farmers Insurance and
• $150,000 from Anthem Blue Cross.

The California Chamber of Commerce added another $2 million, most of it from donations it collected from insurance industry interests.

Yet Californians need not wait for the legislature to behave responsibly on their behalf. They have a potent weapon at their dieposal–a weapon that strikes terror in the hearts of Mafia overlords and terrorists.

%d bloggers like this: