State Doctors Ask Blumenthal To Examine Aetna Contract

By ANDREW JULIEN and HILARY WALDMAN

This story ran in the Courant September 29, 1999

Tired of what they describe as heavy-handed tactics that put profits ahead of patient care, doctors in Connecticut are firing a new salvo in their escalating battle with the insurance industry. Their target: Hartford's Aetna Inc., the health care powerhouse that is quickly becoming a lightning rod for criticism by doctors across the nation.

Top officials with the 7,000-member state medical society asked [Connecticut State] Attorney General Richard Blumenthal Tuesday to investigate a new contract Aetna is asking doctors to sign, saying it violates state law and compromises patient care.

Blumenthal is planning to announce at a press conference in Hartford this afternoon that he will look into the doctors'allegations. ``They raise the specter of assembly-line medical care at the lowest common denominator,'' Blumenthal said. ``We're not prepared to reach any conclusion at this point. We're going to investigate. Our hope is that perhaps Aetna will rethink their decision.''

The medical society is also taking its case directly to the public, with full-page ads scheduled to begin running in daily newspapers today. The ads say that Aetna's policies and practices hamper the ability of doctors to do what they think is best.

``Patients have become commodities to be auctioned off to the lowest bidder,'' said Timothy B. Norbeck, executive director of the Connecticut State Medical Society. ``We have to stand up for the doctors and let patients know how physicians have been totally controlled.'' The $50,000 campaign, titled ``Aetna is playing doctor with our patients,'' coincides with two key events in the health care arena. Employees are about to begin the process of choosing a health plan for the coming year, and Congress is preparing to debate new HMO regulations.

In Connecticut, consumers are already beginning to feel the effects of the dispute, as a number of doctors have said they will not sign the contract, forcing patients to find either new health plans or new doctors.

A spokeswoman for Aetna's health care operations, Aetna U.S. Healthcare, said Tuesday that the company was in no position to respond to the attacks because company officials have not heard them directly from either the medical society or the attorney general.

While the medical society's effort marks a new chapter in the showdown between doctors and HMOs, some of the issues at the heart of the controversy have been around for several years.

Aetna officials have repeatedly emphasized the pressing need to control costs in the $1 trillion-a-year health industry. Managed care came into widespread use this decade to control the runaway medical inflation of the 1980s.

But the financial rewards and punishments adopted by the managed care industry to help control those costs have created frustration among doctors, who say HMOs often punish physicians for prescribing the care they feel a patient needs if it proves too costly.

The new Aetna contract has sparked a new wave of opposition, particularly a provision that requires doctors to participate in each one of the many plans Aetna offers to employers. Doctors say that ``all-products policy'' can force them to work under terms that make treating patients a money-losing proposition.

Dr. Karen Laugel, a Stratford pediatrician, has sent letters to 240 families whose children are treated at her busy practice telling them that they will have to switch to another HMO if they wish to keep her as their primary care physician because she is leaving the Aetna network.

Until now, Laugel said, doctors in Connecticut were allowed to accept certain Aetna health plans and reject others. Laugel said some of the more generous Aetna plans allowed her to turn a slight profit on a $55 well-child visit.

But in the spring, Aetna notified doctors that to be considered part of Aetna's network, they must agree to participate in all of its plans. Laugel and others complain that some of the less lucrative plans give doctors a monthly lump sum for each patient, regardless of how much care is delivered - a system known as capitation.

For example, Laugel said she would get a base rate of about $14 a month to treat each of her 3-year-old patients covered by one of the Aetna packages, regardless of whether the child needed a five-minute earache check or a two-hour workup following a sexual assault. ``You can't stay open if you're being reimbursed below cost,'' Laugel said.

A company statement on the policy said it allows members to see the doctor they want, regardless of which Aetna plan their employer buys. The company began introducing the policy in other states in 1996.

``It is ironic that a vocal minority of physicians, who often criticize managed care for attmepting to interfere with the patient-physician relationship, now criticize the very protection Aetna U.S. Healthcare put in place to preserve the sanctity of that relationship,'' the statement says.

The medical society has also asked Blumenthal to investigate other provisions of the contract, including the company's formula for rewarding physicians who do not overuse services such as hospitals and specialists. Doctors say the system puts the financial interest of the doctor at odds with the needs of the patient.

The U.S. Supreme Court also agreed Tuesday to take up a case involving the effects of bonuses HMOs pay to doctors who hold down costs.

In previous news stories, Aetna officials have said the attacks on its compensation system are unwarranted and that the system is a mix of checks and balances designed to ensure quality while keeping costs in line.

While Norbeck acknowledged that many other HMOs use similar formulas to control costs, he said Aetna has emerged as the industry leader and doctors need to take a stand.

``Others are looking to see what they can get away with, what they can do,'' Norbeck said. He said he hopes the campaign moves Aetna to sit down with local doctors and take better account of their concerns.