[Congressional Record Volume 144, Number 118 (Wednesday, September 9, 1998)]
[House]
[Pages H7472-H7473]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        MEDICAL RED-LINING: ECONOMIC CREDENTIALS FOR PHYSICIANS

  The SPEAKER pro tempore (Mr. Everett). The gentleman from California 
(Mr. Campbell) is recognized for the remaining time of the gentleman 
from Texas (Mr. Paul).
  Mr. CAMPBELL. Mr. Speaker, Robert Weinmann is a medical doctor, 
president of the Union of American Physicians and Dentists, an 
independent labor union based in Oakland, California. He is a resident 
of San Jose.
  Dr. Weinmann was kind enough to lend his support for a bill that I 
drafted that was heard in the Committee on the Judiciary just about a 
month and a half ago, and in his testimony he put forward the argument 
in favor of my bill which would create an antitrust exemption for 
health care professionals to present a united front when they are met 
with a united front on the other side by an HMO or some other 
intermediary.
  Dr. Weinmann requested that I read his op-ed on this subject 
personally, and I am pleased to do so, and it is from the San Francisco 
Examiner of Friday, January 12, 1996. Its title is: Medical red-lining: 
``Economic credentials'' for physicians.
  Credentialing for physicians, a dimension that could be disastrous to 
patients, it is called ``economic credentialing.'' The term refers to 
the use of economic or financial criteria to decide whether or not a 
doctor should have the medical staff membership or privileges without 
which he cannot practice at his local hospital.
  Physicians document their medical education and training when they 
apply for hospital medical staff membership for the privilege of 
practicing and performing surgery in a hospital. Credentialing 
committees in hospitals make sure that physicians do not practice in 
specialties in which they have no training. This scrutiny of medical 
credentials ensures that patients get properly trained doctors.
  Whereas medical credentials determine the expertise of physicians to 
evaluate their knowledge and judgment and to grant them the privilege 
of practicing in a particular hospital, ``economic credentials'' do not 
measure physicians' expertise, knowledge or judgment. Nonetheless, 
``economic credentials'' are becoming more important than medical 
credentials in determining medical staff membership or privileges.
  How do ``economic credentials'' work? Data retrieval is key. Let us 
assume one doctor has 100 patients for whom his diagnostic tests and 
treatment costs $2,000. Let us assume another doctor has 100 patients 
and that this doctor's prescribed diagnostic

[[Page H7473]]

tests and treatment cost $3,000. We can say that the cost ratio of the 
first doctor is 20-to-1, whereas the cost ratio of the second doctor is 
30-to-1.
  In certain managed care plans, such as health maintenance 
organizations, HMOs, with prepaid premiums, the doctor with the 20-to-1 
cost ratio has preferable ``economic credentials'' in comparison with 
the doctor whose ratio is 30-to-1. If the managed care plan is going to 
make a profit, it will do better with the first doctor than with the 
second. So the plan gives the boot to the second doctor and welcomes 
the first one.
  Essential to this program is knowing how much doctors actually cost 
the program in terms of expenses meted out for patients' medical care. 
These expenses used to be called medical care. Now they are 
characterized as losses, or expenses that rob corporate owners or 
shareholders of profit.
  Keeping track of this data and using it to grant doctors membership 
in HMOs, independent practice associations, or hospitals is the 
backbone of economic credentialing. Unfortunately, this backbone is 
spineless and without soul. It doesn't care a whit about patients as 
people, but only about patients as progenitors of cost and expenses. 
Companies want to minimize these costs to enhance profits.
  The danger is that physicians' ``economic credentials'' will become 
more vital to managed care companies than their medical credentials. 
Court decisions have not shot down economic credentialing.
  In Florida, a doctor was denied membership on a hospital staff 
because he was already a heart surgery director at another hospital. In 
other words, his services were declined not because he could not 
measure up medically, but because he was viewed as an economic 
competitor.
  In Los Angeles, a doctor was terminated from a health care plan based 
solely on a business and financial management analysis. The company 
told the doctor that, ``This decision in no way is a reflection on your 
performance.'' An inquiry has been launched to discover if medical red-
lining occurred.
  In San Jose, a group of doctors in a managed care organization were 
issued an edict telling them that coronary stents, a type of heart 
surgery, no longer would be authorized. To ensure that the doctors took 
the edict to heart, so to speak, they were hammered with the following 
declaration, ``If any charges are incurred for such (coronary stents), 
the cost resulting from such will be deducted from your income.''
  Patients need to know that before they join any managed care plan 
they must make sure the plan manages to take care of them before it 
takes care of its owners.

                              {time}  1830

       This advice will not be easy to follow. In some plans, 
     doctors operate under ``gag'' or ``no-cause'' clauses, 
     legally imposed conditions, whereby participating doctors 
     agree not to discuss with patients the plan's financial 
     incentives for doctors.
       Additionally, a doctor's criticism of a plan's refusal to 
     provide diagnostic testing or recommended treatment may be 
     treated as corporate disloyalty and grounds for dismissal.
       In the meantime, it behooves patients and doctors alike to 
     learn how the health insurance industry works. Otherwise, we 
     risk being red-lined out of whatever health care coverage we 
     believe we may still have.

  This ends the editorial by Dr. Robert Weinmann in the San Francisco 
Examiner of Friday, January 12, 1996.

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