USA Case May Open HMO Books

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Case May Open HMO Books; Judge Will Decide Whether Medicaid Role

Makes Records Public April 25, 2006

By HILARY WALDMAN, Courant Staff Writer The battle over the way

three private HMOs spend $622 million in taxpayer money has landed in

Superior Court, where a judge will decide whether the information is

a trade secret or a matter of public interest.

On Monday, Judge Levine scheduled a hearing Aug. 1 that may

begin to settle the question of whether the HMOs serve a government

function by administering the state's Medicaid program for families,

or whether they are simply private contractors doing business with

the state.

If the judge determines they have stepped into the shoes of the

government to run a public program, the HMOs would be subject to the

state Freedom of Information Act.

Ultimately, Levine said Monday, the argument probably will drag on

for years and be settled in the state Supreme Court.

The HMOs - Anthem Health Plans, Healthnet of Connecticut and

Community Health Network - are fighting hard to keep their financial

records secret.

In court on Monday and in recent unsuccessful arguments before the

state Freedom of Information Commission, the companies have argued

that revealing how much they pay doctors in their networks could

damage their ability to compete in the cut-throat health care

marketplace.

The state Department of Social Services, which contracts with the

HMOs to care for 311,000 children and their parents covered by the

state-paid Husky health insurance, which is part of Medicaid, fears

the companies will drop out of the program if they are forced to make

financial records public.

The fight began last summer when a group of New Haven clinics noticed

that their patients were having trouble getting appointments with

private cardiologists and gastroenterologists. The clinic operators

suspected that the HMOs were paying such low rates for their patients

covered by Medicaid that private doctors would not see them.

The clinic operators, led by Kari Hartwig, an assistant clinical

professor in the Yale School of Public Health, asked the state

Department of Social Services to disclose the rates its contractor

HMOs pay specialists for treating Medicaid patients. The state

refused.

The case landed before the state Freedom of Information Commission,

which ruled that the HMOs indeed are providing a government function

and must disclose their rates and other financial information.

The commission also ruled last week that the HMOs must tell the

public how many times people covered by Husky are denied drugs each

month for lack of prior authorization, how many get temporary

supplies to tide them over and how many are still without medication

a month later.

After about two hours of debate before Levine in the state's tax and

administrative appeals session in New Britain Superior Court,

representatives of the clinics and the state, led by Attorney General

Blumenthal, agreed to wait for the records until after the

August hearing.

Although Blumenthal's team had demanded immediate disclosure of the

rate information, the attorney general said Monday that waiting might

settle the dispute once and for all.

" It's privatization, that's why we care so much about the outcome, "

Blumenthal said. " As the state is going more toward privatization, it

becomes an increasingly important issue of whether private companies

can be held accountable. "

The seating arrangement in court demonstrated just how odd this case

has become. Under normal circumstances, Blumenthal would represent

the state Department of Social Services in his role as the state's

lawyer.

But several months ago, he and Gov. M. Jodi Rell split from the

agency when they ordered the Department of Social Services to make

the information public. Since then, Blumenthal has sided with the

clinic operators, while Hugh Barber, an assistant attorney general,

represents the social services department.

On Monday, Blumenthal sat on the left side of the courtroom with

advocates for making the information public. Lawyers for the HMOs sat

at a table on the right. Barber, representing DSS, sat on a bench in

between the two groups.

http://www.courant.com/news/local/hc-

ctmedicaidhmo0425.artapr25,0,2960888.story