http://online.wsj.com/article_email/
SB117130583416806123-lMyQjAxMDE3NzExMzMxMDM1Wj.html

“In this remote mountain village, residents were complaining about a local doctor. Some suspected he was prescribing drugs that weren’t necessary.

“That set off an unusual response: A special council of local health-care monitors — formed as part of an experiment to address sweeping problems in China’s health-care system — swung into action. In 2004, they fined the doctor 100 yuan, or about $13 — a significant amount of money in this poor part of China — for overprescribing drugs. “Hopefully, the other village doctors will take this as a warning,” they wrote in an official notice posted in the village.”

As big as United is, it can’t force doctors to contract with it or make group plan sponsors buy its products. Docs can contract elsewhere and United’s customers can find another insurer.

That is of course very different than if there were only one insurer – say, the federal government – and doctors decided they didn’t like the government’s terms.

I’ve said the AMA is trying to create an issue about “patient choice” and about “fines”. Fine. That’s what trade unions do when defending their members incomes – create issues. But the patient choice matter is silliness and fines aren’t remotely likely. Even if United were stupid enough to actually fine physicians, the market would punish them severely.

That’s not just theory. Good example – Aetna’s experience regarding their capitation strategy in New York about 6-7 years ago.

+ United Healthcare has gotten itself into a very powerful position of market share through acquisition, negatively affecting healthy free market competition.
+ United is exploiting that power through extremely aggressive negotiations with its providers.
+ People against the single-payer movement (like yourself) shouldn’t take United’s attitude of: “well if the doctors don’t like the contract, tough! Try surviving without being in-network with United.”

Why? Because it’s going to backfire with more and more physicians supporting the single-payer system and a swell of political momentum when insureds get fed up with hearing about profit over quality of care.

Ok, fine. (BTW my very long response to you was 28 lines, your response to that was 32. I give, I give!)

United said fines are highly unlikely. And I was answering your question. I think I did. Here it is in bullet points:

+ fines are in the contract
+ the AMA issue is physician incomes, not patient decisions
+ patients are free to go out of network but their insurance reimbursement will be less
+ physicians could elect not to join insurers’ networks
+ that would affect patients insurance “reimbursements” but AMA is not concerned with that.

Then, your very long response didn’t even contain the word fine. Instead you kept saying “reimbursement”? This whole topic is about fining the doctor because it’s not always about reimbursement.
Example: It’s two years from now. Say I haven’t yet met $1 toward my high deductible HSA. And picture that Prof. Hank Sterns dream of full transparency has come true. And picture that you are my doctor. After visiting you, you realize that I need a lab test done. And you are a good enough doctor that you realize that I could get a similar price yet better, more accurate results at a more high tech lab that has recently upgraded to more expensive testing equipment. However, they have also gone through a highly publicized, bitter dispute with United Healthcare because United got aggressive with it’s reimbursements and the lab has just lapsed their contract as a United network provider. To avoid another fine from United, you go ahead and recommend the lab that may not give me the results we desire.
Because I’ll be paying for these tests with my own HSA funds, I then go home and log onto the sterntransparencyreport.com and realize that going to the other lab gives me a better chance of getting the results I need to get better. So I email you to let you know what I found and ask your advice because I still (for some reason) trust your professional opinion.
United has a history of getting aggressive with providers in Colorado. I wouldn’t be surprised if two years from now they’ve had similar disputes with providers. And I wouldn’t be surprised to see them get more aggressive with this idea of fining doctors either. They’ve become very big and powerful and can now treat their vendors and suppliers how they wish. The Wal-Mart business model has entered the American healthcare system and what’s best for the patient no longer matters, profits and stock price are the priority.

“Why would they even mention fining the providers?”

Well, I think maybe possibly perhaps just taking a wild guess here but it could be because reduced reimbursement for out-of-network referrals is part of the contract the provider signed with the insurance company.

I suppose that AMA does not advise its members (fewer than half of all physicians, BTW) to ignore contractual terms agreed to with other vendors and suppliers. Why insurance companies? My guess – this is about physician incomes. It’s not about “patient decisions”.

Is the choice of lab really a “patient decision”? That’s at least arguable. In my experience as a patient and as a benefits manager, patients are referred to labs . . . by physicians. If physicians wish to refer patients to out-of-network labs, they are free to do so – but under most managed care contracts cannot then expect others (i.e., insurance) to pay the same fees for that choice.

AMA could of course advise physicians not to contract with any insurance company. Many physicians are doing just that. They are then be free to treat (and refer) however they wish, and bill their patients whatever they like. Their patients have to pay directly – mastercard comes to mind – and are then responsible for obtaining reimbursement from their own insurance. In fact, wasn’t this very arrangement called “insurance”, back in the day?

Of course, the patient reimbursement in this arrangement would be calculated at the “non-network” level because of the physicians’ refusal to enter a contract with the insurer. But why should AMA be concerned about asking patients to pay more, when physicians incomes are at stake?

Well this is getting really boring. I think I’ll make a list of all the interesting thing I might do this afternoon. I know – -I’ll destroy the galaxy (the one on Orion’s Belt).

Naaaaah – - highly unlikely. :-)

The point is: Why would they even mention fining the providers? It’s a patient decision. United is creating a conflict of interest for the provider. If the provider thinks United network labs are sub-par and recommends a non-network lab the patient understands that there is a price (higher deductible/lower coinsurance) to getting better care.