Sponsor Statement for SB 197

"Prohibiting HMOs from having gag orders on physicians, requiring HMOs identify medical treatments that may be denied and clarifying access to chiropractic care"

Tension between quality medical care and cost containment has been growing in the health care industry. Serious problems have developed in the use of Health Maintenance Organizations (HMOs). Public concern has grown about HMO gag clauses that prohibit physicians from discussing alternative treatment options, financial incentives or second opinions with patients. Some HMOs have not clearly identified medical services that may be denied coverage and guidelines on access to chiropractic care are oftentimes unclear or non-existent. Senate Bill 197 was introduced in response to these concerns and bans gag clauses between physicians and patients, requires HMOs identify treatments that may be denied and clarifies guidelines on access to chiropractic care.

SB 197 bans HMOs from having gag orders which prohibit physicians from discussing alternative treatment options, financial incentives or second opinions with patients. The practice by HMOs of hindering open patient-physician communications was exposed in a December 1995 editorial in the New England Journal of Medicine, and later in a January, 1996 Time magazine cover story. President Clinton has urged Congress, doctors, nurses, health care professionals, and consumers to craft legislation banning gag orders for Americans in HMOs. State legislatures responded and by March, 1997 all but 12 states had enacted legislation or passed rules banning gag clauses. Ten of the remaining states, including Alaska with SB 197, have introduced legislation banning gag orders.

To prevent confusion about treatments that are not covered, SB 197 requires HMOs clearly identify treatments that may be denied a patient. This prevents the HMO from denying coverage to a patient after treatment has been performed but cost is not covered. In an April, 1997 issue of California Medicine, the California Physician's Alliance identified this problem as a primary abuse by HMOs.

SB 197 allows patients direct access to chiropractic care with a licensed chiropractor of their choice and does not require prior consent of a gatekeeper. HMOs attempt to control costs by requiring all patients initially see a gatekeeper, either a Medical Doctor or Registered Nurse, who refers the patient to an appropriate health care provider. Many times a gatekeeper will not recommend chiropractic care, even if the HMO covers chiropractic services.

The concept behind SB 197 is widely supported by the American public, the Federal government, chiropractors and many medical doctors. Although there are no HMOs currently operating in Alaska, SB 197 bans HMOs from having gag orders on physicians, requires HMOs identify treatments that may be denied and clarifies access to chiropractic care.

If you have further questions, please contact Karen Brand of my staff at (907) 465-3892.

DD/kb 1/11/98