HMO Horror Stories

HMOs are a mixed bag.  They excel at disease prevention and screening. But because HMO doctors are often pressured to contain costs, HMO members who fall ill don't always get the best possible care.

Here are some real-life HMO horror stories...and how to avoid being similarly victimized.

Capitation Capitalists

An 88-year-old Sacramento, California,woman developed kidney failure. The drugs and dietary therapy recommended by her HMO doctor proved ineffective. She needed dialysis.

Her doctor believed that dialysis might extend her life. He also knew that dialysis would cost the HMO $40,000 a year.

Since his annual bonus was contingent on the cost of care he provided to his patients, the doctor knew that prescribing dialysis would reduce his income.

The doctor failed to recommend dialysis.The woman rapidly deteriorated and died.

Lesson: Avoid doctors whose incomes are based largely on how well they contain the cost of the care they provide to patients.

At year-end, these capitation capitalists take home a portion of whatever funds they've managed not to spend on their HMO patients.

Before signing up with any HMO, ask an HMO doctor what percentage of his annual income is tied to the cost of services rendered to his patients. Beware of doctors who get more than 30% of their income in this manner.

Persistence Pays

A 34-year-old San Diego, California, man went to his primary care doctor with complaints of abdominal pain, abnormal bowel movements and rectal bleeding.

The doctor found no source for the man's symptoms and refused to refer him to a specialist. When the man's symptoms persisted, he repeatedly asked the doctor for a referral.

Still, the doctor refused. Under his HMO contract, the doctor had to pay directly for every test and specialist referral he ordered.

Finally, at the man's insistence, the doctor performed more tests ...and ultimately determined that he was suffering from colon cancer.

By this time, however, the cancer had spread. The man died a few months after undergoing surgery.

Lesson: Be persistent. If you feel you need a specialist but your HMO doctor doesn't agree, do all that you must to get the referral even if that means calling your doctor's office or the HMO administrator on a daily basis.

Helpful: Purchase a point of service option. This addendum to the standard HMO plan allows you to see doctors outside the network without obtaining prior authorization.

Silent Rationing

A nine-year-old girl living near San Francisco developed nausea and fevers that wouldn't go away. After extensive tests, her HMO pediatrician found a mass in one ofher kidneys. He referred her to a urologic surgeon affiliated with the HMO.

The surgeon diagnosed the girl with a Wilms tumor, a rare cancer. Though well-regarded, the surgeon had never before operated on a Wilms patient.

Her parents weren't sure the surgeon was up to the job. They did a little research...and found that experts recommend that this surgery be performed only by a surgeon who specializes in childhood cancer.

Using their own money, they took theirdaughter to see such a surgeon. He recommended immediate surgery.

The parents tried to get preauthorization for the surgery from the HMO but could not get through on the telephone. The surgery proceeded anyway, and the girl was cured.

The HMO refused to pay for the $50,000 operation, arguing that the girl's parents had violated their HMO contract by going outside the plan.

Lesson: Don't expect your HMO to refer you to the best specialists. Many HMOs prohibit doctors from telling patients that the best doctor or best treatment might not be provided by the patient's plan.

Find out what constitutes the best possible care for your condition...and who is best at delivering it. If HMO doctors can't provide it, fight to get it outside the plan.

Bottom Line/Health interviewed Alan J. Steinberg, MD, a practicing internist and medical director of a managed-care company in Marina del Rey, California. Previously, he was affiliated with one of the largest HMOs in the country.