Clinton Administration Backs Away from HMO Rules
[Posted 7/08/96] Without any notice to consumers, the Clinton Administration has quietly backed away from enforcing rules to force HMO’s to reveal the financial incentives paid to physicians. The rules are required by a 1990 law, apply to Medicare and Medicaid, and were scheduled to take effect May 28, 1996. When the rules were announced on March 27, 1996, Donna Shalala, the Secretary of Health and Human Services, stated: "No patient should have to wonder if their doctor’s decision is based on sound medicine or financial incentives. This regulation should help put Americans’ minds at rest."
The rules were widely criticized by HMO’s who argued that the rules would reduce their ability to control costs, force them to reveal trade secrets, and require re-writing thousands of physician contracts.
(Comment: The battle between the patient’s right–to–know and the HMO’s trade secrets is likely to intensify. On whose side is the physician? wln)