San Francisco Examiner - September 30, 2001
Zoe Mezin, Of The Examiner Staff

Before taking over another doctor's practice in 1996, he had worked with several HIV specialists.

One earned $50,000 a year, which for a private practitioner in San Francisco hardly paid the bills. Another hired him on as a salaried employee, only to lay him off four months later for lack of funds. And a third left the state to escape the low reimbursement rates for treating HIV-positive patients.

Still, Squires, who came of age as a doctor as AIDS was decimating the gay community, wanted to treat patients with the deadly virus.

"I thought I could make a go at it," he said. But like many doctors in his field, he is struggling even though there are plenty of patients to go around, as San Francisco is home to about 15 percent of the state's HIV-positive population.

In two years, he has had to scale back his practice, laying off one medical assistant and cutting back office hours by 25 percent. He has managed to avoid dropping longtime patients. But he doesn't take on new ones either. He currently moonlights as a general practitioner for a major medical group two days a week "just to pay the bills" and continue providing care for his HIV-positive patients.

"Because of the reimbursements," he said. "good care for HIV patients will be less available. The quality of care will deteriorate because a lot of good doctors are choosing not to stick around."

Fixed reimbursement rates from managed care companies have historically driven doctors away from caring for chronically ill patients. But a bill on Gov. Gray Davis' desk seeks to reverse that trend.

Assembly Bill 937 mandates that Medi-Cal reimburse HIV specialists at higher rates than other physicians. Private health plan providers will be asked, but not required, to renegotiate rates.

"It's not ideal," conceded Scott Svonkin, chief of staff for Assemblyman Paul Koretz, D-Hollywood, the bill's author. "But it's a good start."

The extra money would go toward treating the estimated 94,000 to 130,000 HIV-positive patients in California, of which more than 17,000 reside in San Francisco.

Health advocates say the bill is a first step in stemming the flight of doctors from the specialty. No longer would doctors be expected to absorb the costs of treating chronically ill patients. The hope is that more specialists will translate into shorter waits for appointments and better care overall.

Getting HMOs to pay more for HIV specialists isn't expected to be easy. Managed care companies say that once risk-adjusted payments are doled out to HIV doctors, nothing would stop other specialists from seeking higher reimbursement rates.

"If we start putting in adjusted rates for members," said Bobby Pe a, vice president of communications for the California Association of Health Plans, "you're going to have to do it for every chronic condition. What you're basically doing is pushing us back to a fee-for-service system."

Yet, adjusting rates for other chronic illnesses is exactly what some proponents of the bill want. The California Medical Association lent its support to the bill only after Koretz added an amendment that would require the state to study the effects of HMO pricing policies on other chronic conditions such as diabetes, asthma and congenital heart failure.

Managed care companies say the bill attacks the very premise of their existence: to provide care for the masses at low cost by spreading financial risk among HMOs, medical groups and physicians.

Through a method of payment called "capitation," most HMOs reimburse doctors a set amount of money regardless of length of consultation and number of medical procedures. HMOs budget about $75 to $80 monthly per patient, according to the AIDS Healthcare Foundation. Yet, chronically ill patients such as those infected with HIV require an estimated $360 per month in blood tests alone. Much of the difference is absorbed either by the medical group or the private physician.

Traditionally, healthier patients offset costs of chronically ill ones, because they require less care. But doctors with a roster full of HIV-positive patients often discover the scales tipped against them. To balance the books, some simply stop taking on more patients or drop ones they already have.

Taxpayers ultimately bear the brunt of turned-away patients who make their way to publicly funded clinics, proponents of the bill say.

On the other hand, insurance premiums could rise all around if HMOs are expected to dole out more money, managed care companies counter. What's more, they say, taxes would pay for the Medi-Cal portion of the bill that requires the government to pay more to HIV specialists.

Davis is expected to sign the bill by Oct. 14, the deadline for approving laws in the 2001 legislative year.

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