New Jersey Healthcare ADR Lawyer & Attorney : Healthcare Neutral : Richard Webb : New York Metropolitan Area

          Yesterday's Wall Street Journal Health Blog had a post by Jacob Goldstein on the potential struggle brewing between primary care physicians and specialist physicians over the need to free up more money for primary care -  a widely accepted element of necessary healthcare reform.  Earlier that day, the American College of Physicians called for more federal funding for primary care, not through "budget neutral" adjustments in the Medicare physician fee schedule (i.e., by reducing payments to specialists), but simply by paying more upfront for primary care.  The WSJ Health Blog interpreted the primary care position paper this way:

"Congress could try to pay primary care docs more by cutting Medicare payments to some of the rich specialists.  But the rich specialists would fight that tooth and nail, and nothing would ever get done."

          Reading this, I couldn't help but recall a time in my former life when I heard a newly proposed law firm partnership compensation system described by one of its proponents this way: "It will work well because some partners will make more, and everyone else will make about the same."  Regrettably, law firm profits are a zero sum game.  There may be enough "stimulus" mania (i.e. printing of money) in Washington these days to save the primary care docs and the specialists from a zero sum fate, but probably not for very long.

          More than two months ago, this primary v. specialist conflict was predicted and thoroughly dissected by Maggie Mahar and Niko Karvounis in The Health Care Blog, where they dubbed it the "Spread the Wealth Controversy."  In the end, they concluded that money alone would not be the answer to the problem:

"Ultimately, we will probably need to grapple with primary care as a cultural issue within the medical community....in medical schools, students are sometimes looked down upon for choosing to specialize in cognitive care.  Further, research has shown that the medical school curriculum actually drains students of empathy, which may contribute to de-valuing communicative, interpersonal care....The bottom line is that we need to take a multi-faceted approach to the primary care crisis."

          For a more provacative treatment of the need for systemic reform of primary care, see "Mythology and Healthcare Reform" by Monte Uyemura, M.D., also in The Health Care Blog.  Better yet, just subscribe to The Health Care Blog - its a great read on all matters concerning the health care system.

          I have friends and colleagues on both sides of this primary v. specialist conflict.  Most of them don't see it as their conflict at all, and find it unpleasant to talk about.  Unfortunately, it won't likely go away.

[Image: "Artwork" with 20 Dollar bills]

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       I recently learned that Betsy Ryan, the President and CEO of the New Jersey Hospital Association, has started a blog called "Healthcare Matters."  It appears as part of the New Jersey Hospital Association's public website. 

"Healthcare Matters eamines the many issues confronting New Jersey's hospitals and their patients. Readers are encouraged to join the discussion, because healthcare matters- to all of us."

       For those not familiar with Betsy Ryan, she was recently appointed to the NJHA's top management post after years of service as the organization's Chief Operating Officer and General Counsel.  She has extensive experience in the legislative, regulatory, financial and operational issues facing New Jersey's hospitals.  As a result, her blog is well positioned to address a subject not currently covered directly in the blogosphere.

       So far, Healthcare Matters has captured some of Betsy's personal perspectives on current events affecting New Jersey's hospitals.  She has already attracted some lively discussion.  Subscription by RSS is easily done, and I encourage all to join in and expand this dialogue.

[Image: welcome kitty, by Portraitlady4306, August 27, 2007] 

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[An astronaut training in the Neutral Buoyancy Laboratory at the NASA Johnson Space Center]

       I recently read an excellent commentary in the New Jersey Law Journal (195 N.J.L.J. 95, January 12, 2009, page 19) by retired New Jersey Superior Court Judge Harvey Weissbard entitled "The Myth of Judicial Neutrality."  Available online by subscription only, it's worth digging out your old hard copy if you missed this when it first appeared.  In Judge Weissbard's view:

"The notion that a judge is neutral is one of many legal fictions.  The concept presumes that the judge is a tabula rasa, a clean slate."  Instead, Judge Weissbard suggests, "every judge is a product of life experiences, which result in an indelible imprint we may call the judge's personal philosophy...We all know that a lifetime of practice in a particular area cannot be shrugged off when the robe is put on.  And personal world views, derived from family experience or religious indoctrination, are no less likely to influence the judge."

       Judge Weissbard's central point is that judicial neutrality exists only as the result of a conscious struggle by judges to recognize and subordinate their personal values and beliefs to the objectivity that all litigants are promised.

       So, too, is the neutrality of the non-judicial "neutral" in arbitration, mediation and other forms of alternative dispute resolution.  There is no denying the "personal philosophy" one acquires through a lifetime of professional practice, business and personal relationships.  In the course of a friendly conversation or barroom debate, that "personal philosophy" would likely show itself rather clearly.  But like a judge, the ADR neutral must face what Judge Weissbad calls "the proverbial elephant in the room" and handle each case fairly and objectively.

       Unlike a sitting judge, the ADR professional's "neutrality" as perceived by the parties is subject to a higher test in the form of the opinion of the marketplace.  Although judicial forum shopping can and does occur to a limited extent, ADR neutrals are subject to immediate and lasting negative consequences if any party believes the neutral is "biased."  Parties and their counsel will simply vote with their feet. 

       This is the reason why "subject matter expertise" can coexist with "neutrality" on the ADR professional's resume.  Very few neutrals have had a legal practice that was evenly divided among the representation of parties on all sides of the disputes in which they now claim to have subject matter expertise.  In selecting an ADR professional, parties can attempt to figure out whether a candidate's legal experience potentially predisposes him or her to that party's point of view (i.e., a neutral with a shortsighted business plan), or they can select someone who has a reputation for being fair, open-minded and neutral. 

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       One of the hottest areas for disputes in the healthcare industry is the practice of "balance billing" of patients by non-participating providers for services reimbursed by the patient's insurer at less than the provider's billed charges.  The provider's demand to be paid the difference, or "balance," then becomes a point of contention in a three way battle between the provider, the patient and the insurer.  The provider just wants to be paid its standard charge, the patient wants the insurer to cover whatever the patient owes, and the insurer wants to limit its outlay to the payment of a "reasonable" charge.

       Recently, this issue has been played out dramatically in California, where regulators have mandated (and the California Supreme Court has agreed) that non-participating emergency department physicians accept an insurer's payment on behalf of its insureds as "payment in full," with the physicians having no right to collect the balance directly from the patient. The physicians may pursue the insurers, but only by disproving the insurer's determination that the physicians had received the reasonable and customary fee for such services. 

       Meanwhile, in New York, Attorney General Andrew M. Cuomo has wrestled one of the nation's largest insurers, United Health Group, into an agreement to overhaul the manner in which it makes its determinations of "reasonable and cutomary" fees, thereby trying to reduce the number of "balance bills" that end up as payment disputes between patients and providers. 

       Last week, New Jersey got into the act with the publication of proposed regulations by its Department of Banking and Insurance to amend the rules governing the Small Employer Health Benefits Program.  The proposed rules would change the definition of the payment required by insurers to non-participating (or "non-network") providers from a "reasonable and cutomary" charge to the "allowed charge," with the "allowed charge" to be based on the charge profile for New Jersey developed by Ingenix.  Moreover, the rule change would extend to hospitals as well as physicians. Interestingly, the Ingenix model is the same one New York Attorney General Cuomo just compelled United Health Group to stop using in New York, calling that system "unreliable, inadequate and wrong."  Comments to the proposed New Jersey rule changes are due today.

       When health insurers cover services provided by non-participating (or non-network) providers, but do not pay the providers' customary charges, something has to give.  In the current political and economic environment, it is highly unlikely that the states will permit the insured patients to be subject to lawsuits by providers to collect a balance bill.  On the other hand, although the current New Jersey proposal might appear to do so, I don't believe we are ready for a system where a health insurer will be given the authority to effectively determine what all of the healthcare providers in a state can and should be paid by insurers with whom they have no contracts.

       By one means or another, the states will turn these three way disputes into two way disputes between the insurers and the providers.  The rules of this game are just now beginning to take shape, as seen in the California and New York initiatives discussed above. Once those rules are clarified, alternative dispute resolution techniques will come to the fore.  Individual lawsuits to collect a balance bill will disappear, and class actions to challenge the rules of the game will have been played out.  The rest will be about whether providers can get insurers to understand why their charges should be paid. Providers and insurers will find better, faster and cheaper answers to those questions outside the courtroom.

[Rattlesnake sacking, from That Other Paper from Austin, Texas, March 31, 2007]

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     Attorney John DeGroote, in his Settlement Perspectives blog, wrote last week about "The Mediator's Proposal: A Great Tool For Yesterday's Disputes."  As John defines it, a "mediator's proposal" is:

"...a set of settlement terms advanced by a mediator in an effort to settle a dispute when the parties have reached an impasse.  The mediator's proposal is made on a double-blind basis to all parties in separate communications; the parties are asked to accept or reject the terms as proposed, with no modification or counteroffer, within a specific time frame."

     This impasse breaking tool, in John's view, is far too accessible, and as a result, may be creating more deadlocks than it solves.  Calling to mind the old Mad Magazine cartoon "Spy v. Spy," in which Spy White and Spy Black engaged in acts of espionage to elicit responses that could be met with predictable countermeasures, John suggests that sophisticated counsel in many mediations are now purposefully working towards an impasse rather than towards a settlement, knowing that a mediator's proposal will be forthcoming.  In his words,

"Compromise is no longer the goal of the mediation exercise; instead it becomes a play to the 'neutral,' whose power to craft the mediation proposal will make her the real decisionmaker."

     John's observation and "Spy v. Spy" analogy, like everything on his blog, are insightful and well crafted.  So am I worried that by making a mediator's proposal in any of my future mediations I may be working against the fundamental principles of mediator neutrality and party self-determination?  Or that I will be creating more deadlocks than I am breaking?  No.

     First, the notion that the potential for a mediator's proposal will cause the parties to "play" the mediator rather than mediate in good faith assumes that most counsel are not already "playing" the mediator anyway.  My observation is that most good counsel are always doing a little bit of both.  As a mediator, I expect that, and don't hold it against the client.

     Second, at least under my idea of what a "mediator's proposal" should represent, each party's effort and movement prior to the mediator's proposal are relevant to the formulation of the proposal.  I would not offer a mediator's proposal unless the parties have made significant progress towards settlement, there is a discrete and manageable distance remaining between them, and they both seek my input.  In that case, my proposal is intended to suggest a way for them to finish what they have started but cannot conclude despite their best efforts, and further mediation is not possible.  A party who "hangs back" in the mediation process cannot safely assume that my proposal will simply "split the baby."

     Finally, I think most lawyers will have more confidence in their ability to negotiate effectively through good faith mediation than they will have in their ability to double think me (a la "Spy v. Spy") into an advantageous mediator's proposal. 

     In the truest sense, a "mediator's proposal" is not mediation at all, and if it becomes more than an occasionally used closing technique, the process might better be called a neutral case evaluation.  But as long as parties are showing up to mediate, and cases are getting settled, I can deal with the possibility that somebody is trying to outsmart me.  Let's not forget, Spy White and Spy Black each lost an equal number of their encounters.

[Image: A postcard with the public domain "me worry?" face that later inspired Mad magazine's Alfred E. Neuman]

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     Before you head off for the long Thanksgiving weekend, consider signing up for a teleconference to be held next Tuesday that you might otherwise miss in the post holiday crush.  The American Health Lawyers Association ("AHLA"), through its ADR Task Force, is offering "A Practical Toolkit for Managing Healthcare Conflict" from 3:00 to 4:00 p.m. Eastern Time on December 2, 2008.  You can read the full description of the program and sign up on the AHLA's website.  It is open to AHLA members and non-members.

      Presumably, the teleconference will be based on the "Practical Toolkit for Managing Healthcare Conflict" just published by the AHLA, which is available as a PDF on the AHLA website.  This document is a good summary of the need for conflict management in the healthcare (particularly hospital) setting, and provides a framework for hospital management to approach conflict management comprehensively.  It also addresses the specific requirements for internal hospital conflict resolution processes mandated by the Joint Commission.

     No doubt the current economic crisis affecting hospitals in New Jersey and throughout the country  will only make conflict more prevalent and important to manage.  It will be interesting to see whether some of the suggestions made in the AHLA's toolkit, which will carry a new and significant price tag, will gain traction.  I believe what they say about "an ounce of prevention" applies here, but those with the checkbooks may need more convincing. 

     Joining in to hear this program would be a step in the right direction.

[Image: A toolbox, by Per Erik Standberg, May 13, 2006] 

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     Legal periodicals these days are filled with stories about the effects of the current economic downturn on the legal profession.  Some offer dire predictions, while others see a cloud with a silver lining.  The American Bar Association wants to feel the pulse of its members on this issue and share the result of its efforts.  You can go to the poll being conducted for the ABA by Survey Monkey to participate.  Paste this into your browser bar to participate: 

http://www.surveymonkey.com/s.aspx?sm=9Dhw2g7bX_2bxfq4mW8eB1Cg_3d_3d

     Tear yourself away from watching your 401(k) and give this poll about two minutes of your time.  I did, and it made me feel better.

[Image: Fishing net, by Goddard Spaceflight Center Sport Fishing Club, May 15, 2003]

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     Fellow mediator and blogger Nancy Hudgins points out a great site to explore on this day in honor of those who serve in our nation's military.  "Any Soldier Dot Com" will give you the address of a soldier to whom you can send a "care package" of your creation.  Nancy details her own experience in sending such packages, and reminds us that it really doesn't take much to make a big difference in the lives of those who serve.

     I saw Nancy's post just as I read of the efforts of two New Jersey dentists (and friends of mine), Ed Johnson and his daughter, Katelin Johnson. Ed and Katelin conduct an annual drive to buy up the Halloween candy collected by local kids and send it to our troops. The price paid is $1 per pound, and this year their package is expected to exceed 400 pounds.  It will be sent to a local soldier serving in Afghanistan for further distribution there.  The Johnsons pay for the candy and the costs of packaging and shipping.

     Whatever you may feel about our nation's involvement in any given conflict, efforts like these bring to mind that "supporting the troops" can take many forms.  Spread the word.

[Image: Joseph Ambrose, an 86 year-old World War I veteran, attends the dedication day parade for the Vietnam Veterans Memorial in 1982.  He is holding the flag that covered the casket of his son, who was killed in the Korean War]

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       I wrote here previously about the options faced by healthcare lawyers considering the use of an arbitration agreement following the U.S. Supreme Court's decision in Hall Street Associates, L.L.C. v. Mattell, Inc.  As I saw it then, the decision in Hall Street requires counsel to decide what it is about the arbitration process that would cause them to choose arbitration in the first place.  It seemed to me that those who wanted the best of all worlds (i.e., the scope of authority, speed and finality of traditional arbitration and the legal safety net of enhanced judicial review), probably could not have it all.  I just read an article that addresses this point in far greater detail in the context of  cases arising under the New Jersey Arbitration Act.

       In "Law And More: Enforced Arbitration With Enhanced Judicial Review" (New Jersey Lawyer News online, November 1, 2008), attorney Christopher Walsh of the Gibbons firm presents a thoughtful analysis of the issues faced by New Jersey counsel in enforcing an arbitration provision calling for expanded judicial review, even though the New Jersey Arbitration Act allows the parties to select this option.  He focuses on the ambiguity of the Hall Street decision itself, the potential preemption of the New Jersey Arbitration Act, the effects of a removal of a state court vacatur proceeding to federal court, and the use of a choice of law provision to insulate the a desired application of the New Jersey Arbitration Act.

       Although I remain struck by the incongruity of using arbitration subject to "enhanced judicial review," this is clearly a path some parties and their counsel will want to follow.  In New Jersey, Christopher Walsh's article is a good place to begin. 

    [Image: Lesser Ury: Leser mit Lupe, c. 1895]

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