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Issue #193: September 4, 1998
fastfax is available by fax in the 215 and 610 area codes at no cost, or by mail anywhere for $20.00 per year, by calling 215-545-6868, and by E-mail by contacting and type the message SUBSCRIBE in the message section. Sources for some articles in this issue include The New England Journal of Medicine, Philadelphia Business Journal, Philadelphia Daily News, Philadelphia Inquirer.
Keystone Mercy drops five hospitals; 6000 Medicaid recipients affected
Court increases Medicaid drug rebates
State seeks shift of $1m in CARE funds
California gets HIV code reporting bill
Indictment follows gay safe sex video
Allegheny protest set for Sept. 9
Keystone Mercy drops five hospitals; 6000 Medicaid recipients affected
Keystone Mercy Health Plan, the largest HMO serving Medicaid recipients in the Philadelphia area, has announced that it will stop doing business with five area hospitals because the hospitals cannot afford to provide care within the low reimbursement rates of the state HealthChoices program.
The action will force patients of at least 26 physicians, whose names appear on lists of experienced HIV physicians published by the Working Group on HealthChoices and HIV and the AIDS Law Project of Pennsylvania, to switch to Healthcare Management Alternatives (HMA), one of two smaller Medicaid HMOs in the region, or find other doctors with less experience. HMA, the oldest Philadelphia-area Medicaid HMO, is experiencing its own financial crisis, however, and may be forced into similar cutbacks when its arrangements with area hospitals come up for renewal over the next few months.
Dr. Stanton N. Smullens, president and medical director for the 1500-doctor Jefferson Health Network, said that the rates offered by Keystone would result in a financial loss for the hospitals that would undermine their ability to care for people on private insurance. The hospital system could not afford both poor people and private payers, he said.
"We felt the rates they were offering would interfere with our ability to care for other people," Smullens said.
Daniel Hilferty, Keystone Mercy's president and chief executive officer, told the Philadelphia Business Journal that the company decided to terminate its Jefferson contract earlier this summer because the two organizations could not agree on reimbursement rates.
"We've maintained the position all along that the rates paid by the state under HealthChoices are low and when providers are unable to work with us, we will have to consider contract terminations," he told the Journal.
Keystone's action follows a similar decision by HealthPartners, the area's second-largest Medicaid HMO, last year to sever its ties with Crozer Chester Health System in Delaware County and the major medical practice at Temple University Hospital in Philadelphia. Most people living with HIV/AIDS in the region use Keystone and HealthPartners for their medical coverage because those plans include the highest number of HIV specialists.
Five hospitals in the Jefferson Health System, one of the region's largest health-care providers, are affected by the decision, which will force over 6,000 Medicaid recipients at the hospitals to either change to another HMO or find new doctors.
Thomas Jefferson University Hospital in central Philadelphia, Methodist Hospital in South Philadelphia, Bryn Mawr and Lankenau Hospitals in Delaware County, and Paoli Hospital in Chester County are the affected hospitals. The hospitals will continue to accept Keystone members for emergency care, however, as required by federal and state law.
Albert Einstein Health System, which recently linked up with the Jefferson system, had an existing contract at the time the new corporate arrangement was finalized and is not affected by Keystone's decision, although there are fears that the Einstein system will also be dropped by Keystone when the current contract ends if HealthChoices rates are not raised.
Keystone members currently receiving care from doctors located at the hospitals are being asked to choose new primary care doctors or switch to another Medicaid HMO.
Along with sinking reimbursements to pharmacists for AIDS medications and other drugs (including the termination of Keystone and HMA prescription coverage at two of the three largest drugstore chains in the region, CVS and Eckerd, and the likely addition of HealthPartners to the list in September), and the collapse of the bankrupt nine-hospital Allegheny Health System, Keystone's actions fulfill the worst fears of the Working Group and other AIDS advocates when HealthChoices was initiated in 1996.
The two pharmacy chains terminated their Keystone contracts in May, also saying that the rates Keystone offered for HealthChoices recipients were too low.
In testimony at public hearings with state and federal officials, advocates testified that lower HealthChoices rates - believed by some to be almost 20 percent lower than the rates under the old fee-for-service Medicaid program - would result in a denial of care and access to experienced HIV physicians for the region's projected 17,000 people living with HIV/AIDS in the Medicaid program.
"Just at the time that we finally have some real hope from medical treatment for people with AIDS," Jane Shull, executive director of Philadelphia FIGHT, said at the time, "the state is saying to poor people in Pennsylvania, 'but not for you, not for you.'"
Along with the Working Group, the AIDS Law Project and the Pennsylvania Health Law Project presented evidence to state and federal officials that the HealthChoices program would inevitably result in reducing access to quality care for thousands of Pennsylvanians with expensive-to-treat chronic illnesses, because under managed care programs providers must live with whatever payment the state makes, even if costs are higher than the reimbursement. They and other advocates argued that the state needed to create special rates for people with AIDS and other chronic illnesses, or set aside a pool of money to make sure that disabled people were able to get the care they needed if it turned out to cost more than Medicaid was willing to pay under its routine reimbursement system.
Advocates also argued that DPW was sticking to reimbursement rates that were "obviously" too low to try to force hospitals shift the cost of care for Medicaid recipients to those with private insurance.
"It's apparently okay for federal and state governments to simply switch the cost of caring for the poor to the budgets of already-financially-strapped hospitals and overburdened city governments," said David Fair, former executive director of We The People, at a 1996 hearing, "and to the premiums and pocketbooks of people and employers who, thanks to HealthChoices, will be paying more for their own health care as a result."
However, rather than shifting the costs, the Jefferson, Crozer and Temple systems have decided to fulfill another prophecy of the advocates, Fair said this week, "by denying poor people access to care altogether."
State officials have consistently rejected the arguments of advocates, saying that the rates are adequate, and that if dislocations such as the decisions made over the past year by Keystone and HealthPartners occurred, they will only consider changes when the HealthChoices contracts are renewed in 1999.
Over 1,500 local people with AIDS will have died in that three-year period.
AIDS advocates have also complained that the low reimbursement rates are forcing PWAs away from providers who are experienced in caring for people with HIV disease at the same time as numerous studies indicate that care from providers with experience is significantly better than getting care from less-experienced providers - and more cost-effective because people stay healthier and need fewer medical services over the long term.
As HealthChoices has continued over the past two years and options for getting care from HIV specialists continue to be reduced, an increasing number of people with HIV disease are reporting that their doctors do not even know about the federally-mandated treatment guidelines which recommend the use of combination therapies involving protease inhibitors and other antiviral drugs. Many physicians, especially those in neighborhood clinics and smaller hospitals outside the teaching hospital system, continue to prescribe AZT alone and other monotherapies even though such regimens have been rejected as appropriate treatment by medical authorities for several years.
Most advocates expect the situation to get significantly worse when the Allegheny system is sold in the next few weeks, with most or all of the nine hospitals being handed over to for-profit hospital chains who will have even less incentive to accept HealthChoices' low rates.
"Just as we predicted HealthChoices has come to mean less choice for people living
with HIV and other chronic illnesses," said Rob Capone, interim director of We The People. "The events unfolding in this region, in terms of providing health care for poor people, have proven that market forces and privatization can and does do more harm than good."
Capone also noted that "for a system that was supposed to bring market forces and competition into play to bring down costs and increase choice, we are actually witnessing the beginnings of monopolies in the region's healthcare system. It looks to me as though if this trend continues, the only hospital network that will be able to accept the reimbursement rates offered by Mercy will be it's own."
Jefferson's Smullens said that the hospital might decide to pursue a new contract with Keystone Mercy next year if rates are increased by DPW. "We anticipate at some point we will go back to having discussions," he said. "We don't think this is the end. We just both reached the point where we couldn't go any further," he said.
Keystone has the largest portion of the Philadelphia region's Medicaid recipients, with more that 232,000 members, almost half of the total number of Medicaid recipients in the region. HealthPartners has 105,000 members, HMA 71,000, and Oxford Health Plans 64,000.
Oxford recently announced it was pulling out of the private managed care market in southeastern Pennsylvania, and is believed to be seriously considering not renewing its Medicaid contract when it expires next year.
Peg Dierkers, policy director for the Pennsylvania Dept. of Public Welfare (DPW), said last year that DPW may renegotiate HealthChoices reimbursement rates next year but will make no significant changes in the meantime. As reported in fastfax last week, some hospitals have qualified for small increases in Medicaid payments if they can show they are serving a disproportionate number of patients on Medicaid and are losing money, but those payments are not guaranteed from year to year.
The Journal reported that Keystone Mercy plans to present the welfare department with data supporting rate adjustments next month, when the state starts work on its 1999-2000 budget. HealthPartners presented similar data to DPW last year.
The Keystone action began in June, when Jefferson Hospital began to refuse to accept new Keystone patients. Methodist Hospital began stopping new admissions in August.
The three suburban hospitals will pull out of the Keystone network beginning this month.
Most of the doctors who were formerly in the Keystone plan can still be kept by patients if they switch to HMA of Oxford, according to a letter Jefferson Hospital has sent to its Keystone participants.
"We value the trust you put in us and regret we are unable to continue seeing you as a Keystone Mercy Health Plan member," the Jefferson letter said. "If you choose to switch to HMA, you will be able to continue as our patient.
According to the Journal, "about two-thirds of the affected Medicaid recipients have switched to other plans to remain with a Jefferson-affiliated physician." Keystone says the number is more like 50 percent.
Court increases Medicaid drug rebates
In the midst of growing controversy over low payments for prescription drugs to pharmacies by Medicaid HMOs, a federal judge has ruled that the state Dept. of Public Welfare (DPW) must stop using the lower rate schedule by September 30th.
DPW administers Pennsylvania's Medical Assistance program.
U.S. District Judge Harvey Bartle III said the state's Welfare Department improperly lowered the rates on Oct. 1, 1995. The judge issued an injunction prohibiting the Welfare Department from using the lower rates after Sept. 30.
It was unclear whether the judge's ruling would have much of an impact on the decision of two of the area's largest pharmacy chains, CVS and Eckerd, to pull out of the Medicaid prescription drug program of Keystone Mercy Health Plan and Healthcare Management Alternatives, because of low rates, or controversy over low rates instituted by Eagle Managed Care, a Rite Aid subsidiary which sets the rates for Keystone and, beginning in September, for HealthPartners.
It was also unclear whether the judge's ruling would only apply for Medicaid recipients covered under the program's traditional fee-for-service model or whether it would extend also to participants in HealthChoices, the Medicaid managed care program currently implemented only in southeastern Pennsylvania.
Pharmacies in Pennsylvania are reimbursed by the federal government for Medicaid services based on their usual charge to the general public or a formula set by the Welfare Department. The judge said not only had the state used improper methods "to evaluate efficiency and economy" in making reimbursements, but it also had failed to consider how the new rates would affect quality of care, another requirement of federal law.
Bartle noted that pharmacists "repeatedly expressed concern that the lower reimbursement rates would force them to go out of business and therefore remove them as Medicaid providers."
The pharmacists' association had informed the Welfare Department that the lower rates would "take over $42 million out of the pharmacy industry" and "could also bring about the demise of independent community pharmacies."
In July 1995, before the lower rates became effective, Deputy Welfare Secretary Darlene Collins reported that pharmacists believed "both independent and some chain stores" would be forced to close if the revised rates were implemented." About 500 of the 1200 drugstores in the Philadelphia region have already decided they can't fill Medicaid prescriptions, according to DPW.
Concern about the increasingly limited access to Medicaid prescription services has drawn the attention of legislators and other state officials. In August, Pennsylvania Auditor General Robert P. Casey Jr. began an audit of Keystone Mercy that he said would focus on its prescription-drug program.
Casey said the goal was to examine DPW's monitoring of Keystone Mercy's plan, "specifically the availability and access to pharmaceutical services."
Casey said he was prompted to do the audit by competing pharmacists' complaints, and by the decisions by CVS and Eckerd to drop out of the program.
Casey said he had two primary concerns: whether taxpayers were getting their money's worth from the contracts, and whether Medicaid clients' needs were being met. But he conceded that the auditor general's role was limited.
"We can audit these contracts and make sure that the Department of Public Welfare is in compliance. We cannot stop them or force them to change their policy," Casey said.
Casey's father, Robert P. Casey Sr., originally proposed the HealthChoices initiative when he was governor for the eight years prior to Governor Ridge's election in 1994.
State seeks shift of $1m in Title II funds
The Pennsylvania Health Department has underspent its annual federal allocation for AIDS care services under Title II of the Ryan White CARE Act and is now trying to shift the funds to the state's Special Pharmaceutical Benefits Program (SPBP) to avoid having to return the money to the federal government.
State officials, contacted by fastfax, have refused to comment on the issue.
However, sources in several HIV planning councils throughout the state say that Governor Ridge is trying to avoid sending the money back to the Health Resources and Services Administration (HRSA) and get permission to use it instead to help cover the costs of AIDS medications for people with HIV/AIDS who can't afford the drugs. The shift of the Title II money would free up a similar amount of state tax dollars dedicated to the drug program - and that money could then be used to increase the state's surplus.
The new state money that would be made available if HRSA agrees to the state plan would not be used to enhance AIDS services in the state, advocates said they have learned.
State officials had no comment on why the Title II money was not spent in the first place. Last spring, The Philadelphia AIDS Consortium (TPAC), which administers the funding for the five-county southeastern Pennsylvania region, eliminated funding for many historically African American organizations saying that it did not have enough money to spread around.
AIDSNET, the planning council for seven counties north of the Philadelphia area, centralized its AIDS case management functions at only two agencies last year in order to save money. The decision became controversial when the action forced over 60 Spanish-speaking PWAs to seek care from new agencies after the region's only contract with a Latino community organization, the Council of Spanish-Speaking Organizations, was canceled abruptly.
AIDSNET's action was a precursor to similar decisions in Philadelphia, where Title I funding for Latino community-based case management services was reduced by 20 percent earlier this year and where TPAC prohibited using most of its funding for services specifically targeted to Latinos.
More bad news on nonoxynol 9
Nonoxynol 9, proven to be an effective spermicide, does not appear to be able to prevent HIV, gonorrhea or chlamydia infection, according to the final results of a study conducted in Cameroon.
"Plain silicone lubricated condoms are as effective (against sexually transmitted disease) as N-9 lubricated condoms," the researchers said.
fastfax reported last year that preliminary findings in the study indicated that nonoxynol 9 was not protective against HIV, and the final results of the 2-year study appear in the August 20th issue of The New England Journal of Medicine.
The subjects in this double-blind, placebo-controlled trial included over 1,000 HIV-negative female sex workers. The researchers, led by Ronald E. Roddy of Family Health International, based in Durham, North Carolina, randomized the women to use a film containing 70 mg of nonoxynol 9 or placebo. In addition, the women were given condoms, along with instructions on how to use them.
"Nonoxynol 9 film did not give the women in this study any additional protection against infection with HIV, gonorrhea, or chlamydia beyond that provided by condoms and treatment for sexually transmitted disease," the researchers report.
Among the women in the nonoxynol 9 group, the rate of HIV infection was 6.7 cases per 100 women-years, which was not much different from that of the placebo group at 6.6 cases per 100 women-years. Likewise, the rates of gonorrhea and chlamydia were comparable between the two groups.
Based on these findings, Dr. Roddy and colleagues conclude that different "formulations of nonoxynol 9, as well as additional microbicidal compounds with different mechanisms of action, need to be tested as prophylaxis against these diseases."
Although nonoxynol 9 was ineffective in preventing HIV or other STDs, it did not appear to cause any harm, which has been suggested in other studies, Dr. Willard Cates, Jr., President of Family Health International said.
Since the completion of this study, several new trials have been initiated, such as one examining the effects of a nonoxynol 9 gel formulation that contains a slightly higher dose, he continued.
The other "key question" that remains is whether nonoxynol 9 could be effective in a general population of women, who might be less likely to be able to talk their partners into using condoms, Dr. Cates added.
California gets HIV code reporting bill
The California legislature has passed a bill that would create an HIV surveillance system that does not include reporting the names of infected individuals, according to a press release from the San Francisco AIDS Foundation.
California Governor Pete Wilson was sent a bill in late August introduced by Assemblywoman Carole Migden (D-San Francisco) that would implement a coded system to track the state's HIV infections.
Implementation of a code-based HIV reporting system in the largest state in the nation would increase pressure on the eighteen states which currently do not have HIV reporting systems to use codes rather than names for the effort. Pennsylvania health officials have been debating implementing how to proceed with HIV reporting for some time, and are expected to announce a decision over the next few months. Sources said that the state will ask local health authorities to track names of people who test positive for HIV and have them report the information to state officials by code.
New Jersey has used a names-based HIV reporting system for about five years.
"The California State Legislature has supported a sound public health approach to HIV reporting that will provide information on the epidemic without deterring people from testing and treatment," executive director Pat Christen commented in the release. Along with the SF AIDS Foundation, the California Medical Association and the California Conference of Local Health Officers also support the new bill.
Christen cited the success of Maryland's surveillance program that has tracked HIV cases based on an "unique identifier" system since 1993. Other states that are considering a coded approach include Massachusetts, Hawaii, Washington and Connecticut, Christen added.
The issue of how states should track HIV cases has been controversial, and different states have adopted different systems. For example, in June the New York State Assembly and Senate approved an HIV surveillance system that would include the reporting of names and would also require state healthcare workers to ask HIV-infected individuals to reveal the names of their sexual partners.
In addition, last fall officials from the Centers for Disease Control and Prevention recommended that a national HIV surveillance system be started, and has made clear it prefers that name-based surveillance be the model used.
Meanwhile, The Northwest AIDS Foundation in Seattle, Washington has reported that it is discussing and HIV surveillance "compromise" with public health officials in that state.
Under the arrangement being discussed by the Foundation and state officials, whenever a person's HIV status is to be reported to the health department, they would be given the option of reporting their name, or using a unique identifier. The UI used would be a computerized code assignment system called Soundex Plus, which is used by most states and cities for the reporting of AIDS cases.
"Let's call this a 'split system,'" said Richard Jackman, an activist who has opposed HIV name reporting models.
Jackman said that the "compromise" model is appealing to health officials because they believe that most people with HIV would agree to having their names reported. Some activists oppose the system, fearing that people testing positive would feel coerced to give their names or not advised that they have a choice.
Others have noted that people who go to public clinics for testing would be much more likely to be pressed for their names than those who get tested through private doctors and hospitals.
Educator indicted for showing video to teens
A Cape May County, New Jersey grand jury on August 25 indicted an AIDS educator for distribution of obscenity to minors after viewing the Gay Men's Health Crisis-produced video he showed a group of 15 - 17-year-olds at a youth shelter.
The video is labeled for showing to adults only, and has not been approved for presentation to youth groups by the Atlantic City-based South Jersey AIDS Alliance, which sent staffer Keith Carson to the county-run shelter at the Crest Haven Government Complex. Carson will face arraignment before a Newark judge on October 1; conviction could mean up to 18 months imprisonment.
Carson's attorney, David Rocah of the American Civil Liberties Union, said, "The Supreme Court has made it clear that minors cannot be prevented from receiving information about sexuality. This will chill efforts of HIV education around the state and country. The specter of having a prosecutor with no training or expertise looking over an educator's shoulder second-guessing, and the threat of prosecution is appalling, dangerous, counterproductive, and unconstitutional."
However, to County Prosecutor Stephen Moore, the video showing oral and anal sex between men, some in leather and chains, was "clearly inappropriate for educational purposes for young teens," and the case is "simply not a First Amendment issue."
It was the county's director of youth services, Ernie Campbell, who reported the February 23 video showing to law enforcement, even though he has not seen the tape. He admitted that there was some disagreement within his office as to how to proceed, not because of doubts about the video's inappropriateness, but as to whether or not it would be a successful prevention tool. "If it saves one kid, even if it emotionally upsets them ... or empowered one of the girls to say 'no' [to unprotected sex] ... maybe it did something."
But although the Alliance had been sending an educator to the shelter each month for some time, it has not been invited back again. The youth shelter residents' participation was voluntary, and two young women walked out soon after the video had started.
Alliance executive director William Mattle agreed that the video was inappropriate for a teenaged audience, describing it as "a real deviation" from the materials the agency typically uses for that age group. Although he said that Carson had been quickly and decisively disciplined following complaints from the shelter, it was his belief that working in the field had "desensitized" Carson to the material, rather than that the staffer was "attempting to promote an agenda."
Carson is still employed by the Alliance, which was not named in the indictment.
Allegheny protest set for Sept. 9
The Ad Hoc Committee to Defend Healthcare will sponsor a demonstration to "demand quality, affordable, accessible healthcare for all and an end to profiteering" on Wednesday, September 9th, in center city Philadelphia. The coalition was formed in response to the bankruptcy of the nine-hospital Allegheny health care system, and its likely sale to one or more for-profit hospital corporations.
Members of the group will gather at 3:30 p.m. next Wednesday at Allegheny's Hahnemann division at Broad and Vine Streets, and will march at 4:30 p.m. from there to the city headquarters of Independence Blue Cross at 19th and Market Street. A rally will be held at the Blue Cross site from 5:00-6:00 p.m., according to the organizers of the demonstration.
"It is time to stand up and be counted," a committee statement said. "We should all be angry at the money stolen from Allegheny and its endowment, the bankruptcy of an entire nealth care system, the destructive cuts from Blue Cross/Blue Shield, and profiteering over patient care.
Among the programs which may be affected by the Allegheny bankruptcy is the Partnership Comprehensive Care Clinic, one of only two community-based AIDS clinics which routinely makes its services available to uninsured people with HIV/AIDS.
For more information, call 215-242-9681.
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