For an HMO to participate in the CalPERS Health Benefits Program, it must be licensed by DOC and must meet additional requirements mandated by the CalPERS Board. One critical requirement is that the plan must have adequate providers to serve members of specific geographic areas. In reviewing a proposal from a new plan or a proposed expansion of an existing plan into a new geographic area in California, CalPERS staff perform a careful analysis of provider access. Even though DOC examines network coverage as part of its licensure review, CalPERS staff verify the actual network coverage in detail to determine whether adequate primary care physicians, clinics, specialists, and hospitals are available to serve the enrollees. In one incident during the review of a proposed plan expansion, CalPERS staff discovered that physicians were not taking new patients from that plan; therefore, physician access was inadequate to meet the anticipated enrollment. The plan was notified and the expansion was suspended until the provider access problem was resolved.
Changes in contractual relationships between health plans and medical groups affect provider access by disrupting patient-physician relationships. CalPERS recognizes that contract disputes will occur in the evolving, competitive, managed care market. However, there must be a balance between the economic needs of the managed care company and those access needs of patients. A contractual impasse will occur when a health plan and a medical group cannot agree to the terms of their contract and the health plan terminates the contract. When this occurs the health plan notifies its members that they must select a new primary care physician from those still under contract. This causes disruption between patients and their physicians and generates dissatisfaction among the members of the plan.
In one incident a plan terminated its contract with a large medical group within 60 days of the close of the annual open enrollment period. CalPERS members who had just selected their health plan and primary care physician were informed by the plan that they had to choose another physician. It was too late for them to change plans. This resulted in angry complaints