FROM: AMC/NOMA Staff
SUBJECT: AMC/NOMA Notables
Date: March 7, 2002
AMC/NOMA provides print materials through fax blasts, our
magazine – The Cleveland Physician, fact sheets, mailers and through our Web site at www.amcnoma.org. Periodically the physician members with email
addresses will receive the AMC/NOMA Notables.
The ChoiceCare Network, a preferred provider organization owned by Humana Inc., recently announced the addition of SpectraCare, Inc. to their ChoiceCare Network of physicians, hospitals and other healthcare professionals. Members of Humana PPO plans and other health plans supported by the ChoiceCare Network can now receive home health and home infusion services from SpectraCare at in-networking benefit levels. SpectraCare provides home health nursing services and advanced infusion therapy from 17 locations in Kentucky, Indiana, Ohio and Tennessee. More information about the SpectraCare addition may be obtained at the Humana Web site at, www.humana.com.
MIIX
Group reports fourth quarter loss
The MIIX Group, Inc., a leading provider of medical professional liability insurance and headquartered in Lawrenceville, New Jersey, recently announced a loss for their fourth quarter, ending December 31, 2001. The loss is primarily due from strengthening the Company’s loss and loss adjustment expense reserves and from recording a valuation allowance against the Company’s net deferred tax asset.
Net loss reserves were increased by $64.5 million at December 31, 2001, to reflect a trend of unprecedented loss severity that developed in the last half of the year, particularly in the Pennsylvania institutions book. Other states, most notably, Pennsylvania, Texas and Ohio reported adverse development associated primarily with physician business. The reserve increase, representing management’s best estimate of the appropriate adjustment, followed a period of intensive study by the Company’s internal staff, the Company’s outside actuary and a noted medical malpractice actuarial expert.
The Company’s net deferred tax asset grew to $95.4 million in the fourth quarter as a result of the adjustment to net loss reserves, primarily due to the recognition of $26.7million of net operating loss carry forwards. A valuation allowance of $95 million was recorded in accordance with existing GAAP accounting requirements. The valuation allowance recorded against the deferred tax asset is required under the strict guidelines of GAAP accounting literature. For the fourth quarter ending December 31, 2001, with the combined effect of the reserve adjustment and the deferred tax valuation allowance, the Company recorded a net operating loss of $162.8 million as compared to the net operating income of $4.2 million.
New federal antitrust legislation to be announced
Reps. Bob Barr (R, Ga.) and John Conyers Jr. (D, Mich.) plan to unveil antitrust
legislation, entitled "Health Care Antitrust Improvements Act of 2002," which
will enable physicians to effectively negotiate with health plans. AMC/NOMA will provide additional information on
this legislation as it becomes available.
GAO report calls for Medicare regulatory relief
With the release of a new General Accounting Office (GAO) report showing widespread
inaccuracies and obstacles in getting accurate information to physicians. One of the most disturbing findings by the GAO was
that the Centers for Medicare and Medicaid Services (CMS) "defined accuracy as not
being inaccurate."
The report, Medicare: Communications with Physicians can be Improved, also uncovered:
· Information provided to physicians is often out of date, inaccurate, incomplete and
loaded with legal jargon.
· Medicare customer service representatives could only correctly answer 15 percent of GAO
sample questions.
· The acknowledgment by CMS that information and resources shared between CMS and
carriers needs to be vastly improved.
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available on our web site at www.amcnoma.org.