Managed Care & Integrated Delivery Systems (IDS):

Healthcare System Mergers, Acquisitions & Joint Ventures

Copyright 1996-97 William L. Manning except as otherwise noted. All rights reserved. No copyright claimed to original government works. Updated by Bill Manning on 8/03/97

About This Page

This page is dedicated to the various issues relating to managed care joint ventures and IDSs by and among health systems. Many issues, ranging from insurance and HMO regulation to physician incentives, arise when health care systems evolve into global providers and/or payors.

This page highlights some of these challenges. Although I have provided links to sources from various states, the visitor to this page should note that many of the legal issues are governed by state law which often varies by state.

Please feel free to comment on or contribute material here by e-mailing me at wmanning@netreach.net

• Antitrust

  • Price-Fix Risks: Employed Physicians Unionizing But can HMO-affiliated independents do the same?, By Darryl Van Duch, The National Law Journal (p. A01), 7-21-97.
  • Advisory On Exclusive Hospital-Based Medical Service Contracts, Health Law Update from McDermott Will & Emery, Vol. 14, No. 2a, 2-07-97.
  • Rural Health Care and State Antitrust Reform, Michael S. Jacobs, 47 Mercer L.R. 1045 (Summer 1996).
  • Physician-Operated Networks and the New Antitrust Guidelines, New England Journal of Medicine Health Policy Report, NEJM, Vol. 336, No. 5, 1-30-97.
  • Safety Zones, No-Action Letters Prevent Antitrust Actions, By GARY SCOTT DAVIS Steel, Hector & Davis, by Hospital News On-Line.
  • Arrangements for Physician Practice Management, Francis J. Serbarolli, The New York Law Journal, 1-31-97.
  • Physician-Operated Networks and the New Antitrust Guidelines, New England Journal of Medicine Health Policy Report, NEJM, Vol. 336, No. 5, 1-30-97.

  Insurance Regulation

  • Are You Engaged in the "Business of Insurance?", Reinhart, Boerner, Van Deuren, Norris & Rieselbach, s.c.
  • Negotiated Rulemaking on the Shared Risk Exception, Notice of Intent to Establish Negotiated Rulemaking Committee, Federal Register (5/23/97). Text Version. The .pdf version.
  • Committee Minutes: Negotiated Rulemaking on the Shared Risk Exception. June 1997 Committee Minutes (sessions of 6/17 & 6/18). Text Version or Adobe Acrobat Version.
  • Provider Sponsored Organizations, from Reed Smith Shaw & McClay, Health Law Monitor.
  • Pennsylvania DOH & Insurance Dept. Discuss Provider Networks, from Reed Smith Shaw & McClay
  • Health Maintenance Organizations Subject to the Insurance Holding Company Act, Bricker & Eckler, Health Care Department Bulletin, 96-2, 6-5-96
  • Regulation of Risk-Assuming IDSs/PHOs

    The Report of the National Associaition of Insurance Commissioners' Health Plan Accountability Working Group.

  • Ct. Att'y Gen. Opinion on Engaging in Business of Insurance, September 3, 1996.

  Quality of Care Issues

  • Quality-Of-Care Data from Managed-Care Organizations, 2-6-97, NEJM.

  Other Regulation/Issues

  • Medicare Program; Establishment of an Expedited Review Process, 1997 Federal Register, 4-30-97.
  • Direct Contracting, John K. Iglehart in The Struggle to Reform Medicare, NEJM, Vol. 334, Iss. 16, 4-18-96.
  • Overview Of Recent Federal Legislation Regulating Group Health Plans And Insurers, from Reed Smith Shaw & McClay (Dec 1996).

  • Complying With The Physician Incentive Plan Regulation

    Resources from the American Association of Health Plans (AAHP) & elsewhere.
    • Federal Rules: Physician Incentive Plans in Medicare/Medicaid Health Plans.
    • Notice on Physician Incentive Regulation Compliance Dates.
    • Physician Incentive Plan Regulation -- Clarification AAHP Disclosure Forms and Instructions
    • Self Extracting zip file, for the Physician Incentive Plan Regulation Material. All three files are in WordPerfect 6.1 format and are contained in this zipped program and are from American Association of Health Plans (AAHP).
    • Implementation of Physician Incentive Plan Regulation Memo, from AAHP
    • AAHP Summary Chart Instructions, from AAHP.
    • AAHP Physician Incentive Plan Worksheet, from AAHP.

  Business Issues

  • The Evolution of Managed Health Care, Integrated Healthcare Ass'n.
  • Medical Practice Sales To Hospitals- A Valuation Minefield- Part I, By George B. Hawkins, ASA, CFA, President Banister Financial, Inc. Business Valuation Specialists.
  • Selected Bibliography on MSOs, AAHP
  • History of HMOs Bibliography, AAHP
  • Network-Based Health Plans Definitions, AAHP
  • Arrangements for Physician Practice Management, Francis J. Serbarolli, The New York Law Journal, 1-31-97.
  • Health Care Indicators. Contains data and analysis of recent trends in Health Care spending, employment and prices.
  • Markets and Plan Performance: Private Summary Report on Case Studies of IPA and Network HMOs, by Nancy M. Kane, D.B.A., and Nancy C. Turnbull, M.B.A., Dep't of Health Policy and Management, Harvard School of Public Health and Cathy Schoen, Director of Research and Evaluation, The Commonwealth Fund (January 1996).
  • Models of Physician-Hospital Organization: Possibilities and Pitfalls, by Burns (1995).
  • The Future of Managed Care: An Analyst's Perspective, Provides an extensive outline of all the factors related to investing in the stock of managed care corporations.

• Texas Loses Way To Sue Hospitals: The state high court says malice is necessary in credentialing suits, By Kate Thomas, The National Law Journal (p. A06), 7-15-97.
• Florida Physicians Group To Form 'Negotiating Units', Reuters, 7-11-97
• PSO Study Finds Federal Regulations Stronger, Reuters, 7-10-97
• Ohio Law Sets Solvency Standards For Health Plans, Reuters, 6-17-97
• States Licensing High Number Of Provider-Owned Health Plans, Reuters, 6-5-97.
• HMOs' pay to doctors called 'appropriate': Report finds compensation based on quality of care, not withholding it, Alex Pham, Boston Globe, 05/23/97.
• Careful Evaluation Of Capitation Contracts Can Lead To Profitable Arrangements, Reuters, 4-15-97.
• Optometrists file lawsuit against HMO: Say Harvard Pilgrim hurting firms by denying them contracts, Alex Pham, Boston Globe, 03/26/97.
• Government Should Follow Example Of State Regulation Of Health Insurance Market, Reuters, 3-21-97.
• Statement on Medicare Payment Policy for Health Plans and PSO Participation in the Medicare Program, Karen Ignagni, President and CEO, American Association of Health Plans before the Senate Finance Committee, March 20, 1997.
• Statement on Medicare Provider Service Networks, for the American Association of Health Plans by Thomas R. Sobocinski, President and Chief Executive Officer, Physicians Plus Insurance Corporation,Before the Subcommittee on Health and Environment House Committee on Commerce, March 19, 1997.
• New Study Demonstrates Full Impact of Administration's HMO Medicare Cuts, AAHP, March 18, 1997
• Statement on Medicare Regulation and Quality, Karen Ignagni, President and CEO, American Association of Health Plans, Before the House Ways and Means Committee Subcommittee on Health, March 6, 1997.
• Physician Deals Top List Of Healthcare Mergers, Reuters, 3-13-97.
• Costs And Efficiencies Differ Between Point-Of-Service Plans and HMOs, Reuters, 3-13-97.
• HEDIS Reporter Software Launched, Reuters, 3-11-97.
• Certification Required In California For Office Anesthesia, Reuters, 3-05-97.
• Supreme Court Won't Hear Cigna Case, Reuters, 3-05-97.
• Two Bills Take Different Routes to Protecting Patients in Managed Care , Spencer Rich, Washington Post Staff Writer, 2-26-97; Page A06, The Washington Post
• Health plan association says it will enforce quality standards, Fox News, 2-25-97
• President Clinton To Prohibit HMO Gag Clauses, Reuters, 2-21-97.
• JCAHO Announces New Outcomes-Based Accrediting Component, Reuters, 2-20-97.
• HCFA Drafting Legislation To Recover Medicare Funds, Reuters, 2-20-97.
• Physician Financial Incentives Affect ED Admission Rates For "Lower-Acuity Conditions", Reuters, 2-18-97.
• New Jersey And Texas Outline HMO Rules That Protect Consumers, Reuters, 2-12-97.
• New BC/BS Quality Statement Addresses Hot-Button Issues, Reuters, 2-12-97.
• Blues Say More State Laws Will Target Managed Care Limits In 1997, Reuters, 2-12-97.
• Specter Urges Education Carve-Out, PSO Approval, Hosp. Ass'n PA, 2-07-97.
• Provider Network Size Differs by Region, Profit Status and Model and Plan Type, PRNewswire, 2-04-97.

• IGNet
• HHS OIG Special Fraud Alerts
• HCFA
• GPO Access search the Federal Register, U.S. Code, Congressional bills and other government pubs.
• State Statutes by Topic
• Modern Healthcare Magazine
• HFMA - Healthcare Financial Management Association, a professional association for financial professionals in the healthcare field.
• NVST Mergers & Acquisitions - Venture Capital Meta Site - Excellent resource, albeit not uniquely related to health care. Be sure to access the site's NVST Academy page, chock full of glossaries, checklists and other useful explanatory items in M&A and venture capital transactions.
• Nonprofit Times Magazine, an on-line monthly.
• Nonprofit Resources.

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