March 1, 2004

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Governor Nominates Budget Expert As New "Superagency" Commissioner
Governor Baldacci has chosen John "Jack" Nicholas to be the Commissioner of the state agency to be created by the merger of the Department of Human Services and the Department of Behavioral & Developmental Services.


Nicholas, who was the State Budget Officer from 1992-2002, was praised by the Governor for his financial expertise, solid moral character, and team approach.  Criticism over the nomination has arisen from several legislators, including Senator Michael Brennan, Chair of the Health and Human Services Committee.   Brennan commented that Nicholas lacked knowledge of DHS programs, mental health, health care, and managing organizational change.  Nicholas's nomination will be heard by Brennanís committee and must be approved before it goes to the Senator floor for final passage.  Nicholas has been Acting Commissioner of DHS for the past few months, a position he took after retiring from the State and spending a year as the Chief Financial Officer of Catholic Charities of Maine.


The Governor also announced that the legislation to merge the two agencies has been drafted and should be printed within the next few days.  MMA President Maroulla Gleaton, M.D. sent a letter to the Governor this week expressing concern over the proposed organizational chart which puts the Bureau of Health two bureaucratic levels beneath the Commissioner.  The letter notes that the Director of the Bureau of Health needs direct and immediate access to the Commissioner in order to respond immediately in the event of a public health crisis.  See below for the full text of the letter.


In touting the merger, the Governor has claimed that it will produce a savings of millions of dollars and, indeed, six million in savings has already been booked in the current budget.  However, the legislation is controversial and while the Legislature is looking for sources of savings under every rock, this bill is expected to get a thorough vetting. 


February 26, 2004


The Honorable John Elias Baldacci

1 State House Station

Augusta, Maine 04330


Dear Governor Baldacci,


As President of the Maine Medical Association, I congratulate you on your effort to merge the Department of Human Services and the Department of Behavioral and Developmental Services to achieve the primary objective of improved service, increased efficiency and improved relations.  However, upon reading the report of the Commission issued last month, I was dismayed that the Director of the Bureau of Health would not report directly to the new Commissioner.


The Director of the Bureau of Health needs direct and immediate access to the Commissioner in order to respond immediately in the event of a public health crisis.  While these crises could include natural disasters such as floods and storms or a localized food-borne illness or poisoning (such as the arsenic event in New Sweden), they also include emerging biological events such as SARS and West Nile virus, not to mention the increasing potential for an event caused by anthrax, small pox and other bioterrorism.  Now is not the time to be de-emphasizing our public health efforts.


The success of Dirigo Health also rides on two critical functions carried out by the Bureau of Health, prevention and health promotion.  The continued success of the Bureau in smoking cessation, nutrition, maternal and child health, and dental care, to name a few, will go a long way to decreasing health costs overall, another critical element in Dirigo Health.  Our collective goal is a more aware and engaged populace, something only achievable with high-profile support from the Administration.


The Maine Medical Association believes that it would be poor public policy to remove the Director of the Bureau of Health from directly reporting to the Commissioner.  The critical nature of the functions performed by this position demands a department-level response.  Also, this position needs to attract high quality health officers, which would be jeopardized under the suggested organizational chart.  We

need to elevate public health issues, not bury them.  If public health issues get buried deep within a bureaucracy, the public will not respond at the appropriate level necessary and the Legislature will increasingly lose sight of the importance of these issues in this age of term limits.


We ask you to create a new department structure which allows for real support of the programs of the Bureau of Health.  The Bureau performs a crucial function in state government, one that has a profound effect on all Maine citizens and one that is likely to become even more important in the future. 


Thank you for your time and consideration.






Maroulla Gleaton, MD



cc:       Members of the Joint Standing Committee on Health and Human Services

            Jane Lincoln, Office of the Governor

            Kathryn Monahan Ainsworth, Office of the Governor

U.S. Senate Fails to Advance Medical Liability Reform Bill
On Tuesday, 2/24/04, the U.S. Senate voted 48-45, 12 short of the 60 votes required for cloture, in favor of S. 2061, the Healthy Mothers and Healthy Babies Access to Care Act.  This result was one vote less than pro reform advocates achieved in a similar procedural vote last summer.  Only three Republicans voted against the measure which was brought forward by the Senate Republican leadership - - Senators Graham (SC), Shelby (AL), and Crepeau (ID).  Both The Maine Medical and the American Medical Association both lobbied in favor of the proposal, along with many of the national medical specialty societies.  While most groups would prefer a bill that provides some protection for all physicians, ultimately half a loaf is better than nothing, which is pretty much what the Congress (Senate side) has given physicians in the area of tort reform for the past twenty-five years.

Please take a moment to thank Maine's two Senators for their votes in favor of liability reform.

Senator Olympia J. Snowe:  202-224-5344;

Senator Susan M. Collins:  202-224-2523;

In a surprising sequence of events, Senator John Warner (R-VA) whose father was an OB/GYN apparently was sufficiently outraged by the Senate's recent vote in favor of limiting the liability of gun manufacturers while failing to move medical liability reform to take action.  He has offered an amendment (#2624 to S. 1805) to the gun bill that would establish federal medical liability reform, including a $250,000 cap on non-economic damages, for all physicians.  Although Senator Warner faces a very difficult procedural task, his amendment continues to focus attention on this issue of great importance to the physician community. 

Senate Majority Leader Frist expects to offer a trauma care bill, similar to S. 2061, for consideration in April. [return to top]

Governor Reappoints Superintendent of Insurance Alessandro Iuppa
On Wednesday, 2/25/04, Governor Baldacci announced his reappointment of Alessandro A. Iuppa for a second five-year term as Maine's Superintendent of Insurance.  As Superintendent, Mr. Iuppa oversees a regulatory agency of 86 staff and a budget of approximately $10 million.  The Bureau of Insurance has oversight of insurance companies and individual producers in Maine.

The MMA applauds the announcement.  Mr. Iuppa  has developed strong relationships with the Legislature and interest groups.  Several years ago, he presided over the Anthem transaction, ensuring that 35 pro-consumer/provider protections were included in his final order.  He protected the interests of physicians who were due claims payments from the former Tufts Health Plan and Harvard Pilgrim Health Plan during their insolvency proceedings.  More recently, he directed the Bureau staff to undertake market conduct surveys or audits of Anthem's, Aetna's, and CIGNA's compliance with Maine's "prompt payment" statute, 24-A M.R.S.A. sec. 2436, requiring interest payments if claims are not paid or disputed within 30 days of submission.

The appointment is for a five-year term and subject to legislative confirmation.  Iuppa was initially appointed superintendent in l998.  He came to Maine in l994 to assume the position of deputy superintendent of insurance. He previously held the positions of deputy commissioner and commissioner of insurance in the Nevada Division of Insurance from 1986 to 1991.  While MMA and the Superintendent have not been in agreement on every issue, he has always had an open door policy with the Association and is visited frequently by MMA staff.  Upon hearing of the re-appointment, Gordon Smith, MMA EVP noted, "This is a good move on the part of the Governor.  Except for Al being a lifelong Yankees fan, we've always gotten along well."

Read the Governor's press release about the reappointment of Superintendent Iuppa. [return to top]

MMA Payor Liaison Committee Meets with Cigna Officials
MMA's Payor Liaison Committee, chaired by Thomas Hayward, M.D., met on Feb. 18th with officials from Cigna Healthcare.  Richard White, Mark Ouellette and Robert Hockmuth, M.D. described recent changes at Cigna and the impact of the recent settlement of the federal class action suit filed against the company and other health insurers.

Mr. White, Market Service Leader for New England for Cigna, noted that about one and one-half years ago, the company split the management into regions, with Maine becoming part of the Northeast Region.  Dr. Hockmuth is now Medical Director for the region, and is based primarily in New Hampshire.  The staff at the Freeport office is now down to about 25 people, with most of the provider relations staff working from their homes.

Dr. Hockmuth explained that he is responsible for medical management in New England.  He works chiefly with providers on problem resolution, sometimes rounds with nurses and works on provider appeals throughout the region.

Relative to changes following the settlement of the national class action litigation, Mr. White noted that while the Judge has approved the terms of the settlement, the company is in a 30 day hold before more action can be taken.  Many positive changes will follow , however, including development of a website with an email box for information about claim coding, fee schedules, etc.  Copies of medical records will no longer be required for office visits on day of surgery, and there will be a gradual reduction in the number of procedures requiring precertification.  A contract amendment will be sent out, specifying that the current 30 day notice period for amendments will be extended to 90 days.  The company hopes to phase in most of the changes beginning the 2nd quarter.  The court will provide oversight to the process.

Mr. White attributed many of the problems of the past to too much complexity within Cigna's systems.  Too many platforms, too many different forms, too many human errors, training issues, extensive precertification requirements and the poor transition of some functions to other offices, particularly Pittsburg.  He felt that the most significant issues were behind them.

Cigna remains committed to the market in Maine.  Currently there are about 110,000 Cigna enrollees in Maine, down approximately 10% from one year ago. [return to top]

2004 Physician Survival Series to be held May 26 and June 23.
The Association's Twelth Annual Physician Education Program, designed for physicians and practice managers, will be held Wednesday, May 26 in Auburn and June 23 In Bangor.  Topics will include:  The New Electronic Drug Monitoring System, MaineCare, Board of Licensure in Medicine update, Dirigo Health, Maine RX Plus, Drug Diversion,  Disease Management, Reimbursement, Employment/H.R. issues, Enforcement of payor contracts  and the increasingly Criminalization of  Enforcement Actions. 

Registration materials will be available in the March/April issue of Maine Medicine but persons wishing to reserve space at either location may contact Chandra Leister at MMA for more information ( [return to top]

Dirigo Health Hospital Study Commission Looks at Anti-Trust Issues
The nine-member Hospital Study Commission established in the Dirigo Health legislation met on March 1st and heard presentations from the state office of the Attorney General relative to the impact of the state and federal anti-trust laws on Maine hospitals.  The impact of the Maine Hospital Cooperation Act, enacted in l991, was also featured.  While the Hospital Coorperation law was enacted for the express purpose of allowing more collaboration and coorperation among hospitals, it has been utilized only twice in the 13 years of its existence. 

Commission members lamented that while the law was helpful, hospitals needed to be incentivized to cooperate, rather than compete.

The Commission was briefed extensively on the issues involved in the settlement of anti-trust charges against the Maine Health Alliance in 2003.  The Alliance was a Physician-Hospital organization consisting of 11 hospitals in the northern portion of the state and approximately 350 physicians on their medical staffs.  Both state and federal anti-trust authorities alleged that Alliance members were not sufficiently integrated financially to protect themselves from a charge of violating antitrust laws through joint negotiation and contracting with insurers.  Additionally, enforcement officials claimed that the joint contracting was not necessary for the success of any clinical integration.

The Commission will meet again on March 15, 9:00am to noon in Augusta. [return to top]

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