By Chad Terhune
August
28, 2017
Capitol
Desk delivers the latest in health care policy and politics from Sacramento and
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California
officials have again slapped health care giant Kaiser Permanente with a
multimillion-dollar fine for failing to provide data on patient care to the state’s
Medicaid program.
The
$2.2 million fine comes just months after a $2.5 million penalty in
January against Kaiser, one of the largest nonprofit health plans in the
country. The California Department of Health Care Services said these are the
first fines it has imposed against a Medicaid managed-care plan since at least
2000.
The
state agency uses this data on hospital admissions, doctor visits and
prescription drugs to help set rates, ensure adequate care is available and
monitor how tax dollars are being spent in the $100 billion program, known as
Medi-Cal in California.
Kaiser
isn’t appealing the latest fine, and the Oakland-based health plan said it
expects to deliver the required information by September. (Kaiser Health News,
which produces California Healthline, is not affiliated with Kaiser
Permanente.)
The
reporting lapses are surprising given that Kaiser is known industrywide for
pioneering the use of electronic medical records and developing data-driven
treatment guidelines. But Kaiser has said its systems and technology were not
designed to collect information in the format required by the state. The
company said the sanctions were in no way related to the quality of patient
care.
“We
have recently made significant investments in new technology to help us comply
with the new administrative data reporting requirements,” Nathaniel Oubre,
Kaiser Permanente’s vice president for Medi-Cal, said in a statement. “We are
committed to full compliance.”
Jennifer
Kent, Department of Health Care Services director, notified Kaiser of the
latest fine in a May 25 letter. She wrote that the insurer was
making efforts to resolve the deficiencies, but it still had not complied with
state deadlines. One of her deputy directors, Sarah Brooks, said the agency has
been trying to get Kaiser to comply with the rules since 2014.
The
state “takes very seriously its commitment to ensure contract compliance from
Medi-Cal managed-care health plans so members can get the care they need,”
Brooks said.
Brooks
said additional fines may be imposed depending in part on whether Kaiser’s
violations put Medi-Cal out of compliance with federal rules. That could force
the state to repay money to the Centers for Medicare & Medicaid Services,
which funds the Medi-Cal program jointly with the state.
Kaiser
is among 22 health plans that participate in the Medi-Cal program. About 80
percent, or 10.8 million, of Medi-Cal’s 13.5 million enrollees are
in managed-care plans. Kaiser serves about 700,000 Medi-Cal enrollees.
In
addition to being an insurer, Kaiser runs 39 hospitals across the country and
hundreds of clinics. Kaiser operates in eight states and the District of
Columbia, but about 70 percent of its 11.8 million members are in California.
For 2016, the company had net income of $3.1 billion on
revenue of $64.6 billion.
A
consumer advocate said it’s disturbing that Kaiser has defied state rules for
so long.
“We’ve
seen Kaiser use their unique model as an excuse for putting themselves outside
the law in the past,” said Carmen Balber, executive director of Consumer
Watchdog, a Santa Monica advocacy group. “This demonstrates their hubris.”
In Medi-Cal
managed care, the state pays insurers a fixed amount per enrollee to provide
comprehensive care. That’s different from the traditional fee-for-service
system, in which the state pays medical providers directly for services
rendered.
Kaiser
has faced other fines from California regulators. In 2013, the California
Department of Managed Health Care fined the insurer $4 million for problems
with patient access to mental health treatment. In June, the
managed-care agency criticized Kaiser again for
failing to address long delays in treatment, and it said additional fines were
possible.
Chad
Terhune: cterhune@kff.org,
@chadterhune
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