Medi-Cal Docs Who Fail Site Reviews More Likely to Face Board Discipline

Many Los Angeles County doctors who treat the poor in California’s Medi-Cal managed care program have earned poor grades on safety, cleanliness and other measures the state uses to monitor health care delivery for some of the state’s most vulnerable patients.

Those poor marks, moreover, are often an indicator of even more serious problems. State records show that doctors who fail the managed care plans’ internal reviews or pass conditionally are twice as likely as other physicians to have been disciplined by the Medical Board of California, which licenses doctors and oversees the medical profession.

Statewide, Medi-Cal managed care plans serve some 8 million Californians or about 70 percent of the state’s Medi-Cal caseload.

The plans are required to conduct extensive facility site reviews and medical record reviews every three years at each of the physicians’ offices where their members are seen, and must report the results biannually to the Department of Health Care Services, the state agency that oversees them.

About one in five LA County physicians scored below par on site reviews, either passing conditionally or in a small minority of cases, failing outright.

Those doctors can continue to see Medi-Cal managed care patients provided they submit proof they’ve corrected their errors within state-mandated time frames.

A California Health Report analysis of the most recent Los Angeles County site review reports, which include some 1,700 physicians’ offices, shows that doctors who scored poorly on site reviews were also more likely to be disciplined./ have a record of medical board discipline Nearly 400 of the doctors failed site reviews or passed conditionally. They were more than twice as likely as California doctors on the whole to have been disciplined by the state medical board for fraud, incompetence or negligence.

Medical board discipline is rare. Just three percent of all California physicians have a disciplinary record, compared to more than six percent of doctors with below-par site review scores, according to the state’s latest report.

Lars Erik Hanson, a family practice physician who operates three clinics in eastern Los Angeles County, passed site reviews at two of his clinics, but scored only a conditional pass at a third. Hanson, who currently contracts with LA Care, the largest of two Medi-Cal managed care organizations in LA County, was rated particularly poorly in the category of personnel – failing with a grade of 33 percent in 2013.

Three years earlier, the medical board had publicly reprimanded Hanson after the death of a 30-year-old woman who’d come to Hanson’s clinic for an abortion. The LA County Coroner classified the death a homicide.

Hanson ran his clinic with no anesthesiologist, no nurse anesthetist, no counselor and no one trained in post-operative care, according to the medical board accusation against Hanson.

Paramedics were called after the woman went into cardiac arrest following a reaction to an anesthetic. The paramedics called police because a shirtless man—later identified as Hanson— was running through the clinic. Another physician had performed the abortion, but Hanson initially helped with CPR, then panicked and ran from the room when the patient vomited on him. He was sanctioned for gross negligence, unprofessional conduct and repeated negligent acts.

The medical board also noted that Hanson maintained expired medications, and non-sterile instruments.

At one of Hanson’s clinics, his wife and receptionist, Amy Chiang, said the case against Hanson was unfair, but Hanson didn’t return phone calls.

In addition to staffing requirements, state-mandated site reviews also require doctors to be properly equipped, practice standard infection control procedures, and offer preventive care among many other items.

DHCS site review documents show that one physician’s office lacked a stethoscope and blood pressure cuffs in various sizes. The office had no eye chart and didn’t practice needle stick precautions. Prescription drugs and hypodermic needles weren’t stored in a locked space and drugs were not refrigerated at an appropriate temperature.

At another office, inspectors found there was no procedure for isolating patients with communicable diseases and drugs weren’t prepared in a clean area.

In both cases, the physicians corrected their errors.

Poor grades don’t necessarily signal danger for patients. Some physicians could be dinged for administrative flaws. Still, the vast majority of poor scorers also got low marks in at least two categories in which many items directly affect patients: infection control and clinical services. Infection control includes handwashing, needlestick safety, and sterilization of medical instruments, while clinical services includes making sure vaccines are stored at appropriate temperatures so that they maintain their effectiveness, and drugs are handled and dispensed only by qualified staff, and kept in sanitary conditions. The state considers deficiencies related to infection control and pharmaceuticals serious enough to require immediate proof of correction, even if a physician has otherwise passed a site review.

Jonathan Freedman, LA Care interim Chief Operating Officer argued that Medi-Cal managed care physicians are subject to an extra level of scrutiny, given that doctors outside the program, including those who treat Medi-Cal patients who are not in managed care plans, don’t undergo site reviews.

But Ulfat Shaikh, a pediatrician who is Director of Healthcare Quality at the UC Davis School of Medicine, contended the state’s requirements for Medi-Cal managed care providers are reasonable.

“I think this is very relevant to out-patient facilities,” she said. “I don’t think this is overdone. I think that is what other out-patient facilities should be held accountable for.”

Still, Shaikh said, good reviews don’t necessarily mean your doctor is a skillful one,

The scores don’t measure patient outcomes, which is a major flaw in quality measurement systems in general, she noted. Still, bad scores could be a red flag.

“It could be in the same way that a restaurant rating [by a county health department] is a red flag,” noted Clemens Hong, an instructor in medicine at Harvard Medical School who has studied quality of care issues.

“These are pretty nuts and bolts parts of health care delivery,” Hong said of the doctor whose office had neither a stethoscope nor proper blood pressure cuffs. “You’d hope that people are able to meet those.

“That would be a pretty heavy red flag.”

Indeed, in cases like Hanson’s, reviewers noted his deficiencies in personnel at one clinic three years after medical board investigators found that his lack of qualified staff contributed to the death of a patient.

Similarly, Vahan Madatovian, a family doctor in Glendale, failed a site review and a medical records review in 2013. His office wasn’t clean, wrote Health Net reviewers in their report. He lacked equipment to administer oxygen in cases of emergency, and his medical records lacked evidence that he offered basic preventive care like screening for obesity, breast and cervical cancer and tuberculosis, among other conditions.

The following year, in a public reprimand by the medical board for repeated negligent acts that delayed a bone cancer diagnosis in one patient, Madatovian was also reprimanded for failing to maintain adequate and accurate medical records.

Madatovian completed a corrective action plan and continues to see Medi-Cal managed care patients.

At his Glendale office, Madatovian pointed out that many medical board cases are far more egregious than his, but declined to argue with the board’s findings. He added that he is transitioning to electronic medical records, which he expects will make record keeping easier.

State regulators don’t require disclosure to patients that their physicians have failed site reviews. Medical board discipline, however, is a matter of public record.

At DHCS, Sarah Brooks, Chief of the Managed Care Quality and Monitoring Division said she had no comment on the higher rate of medical board discipline among doctors with low scores on site reviews.

The state requires that Medi-Cal managed care plans check the qualifications and licenses of their doctors before signing contracts with them, and every three years thereafter. They also must check their work histories, liability claims, Medicaid or Medicare sanctions and sanctions from state agencies or licensing boards, among other things. But the state’s policy letter doesn’t offer guidance on what the plans should do with the information.

State officials said that managed care organizations are prohibited from contracting with providers who are excluded from Medicaid or Medicare , but declined to elaborate further on the policy letter.

At Health Net, spokesman Brad Kieffer said that contracting of physicians involves “a rigorous, systematic comprehensive review.”

Both Kieffer and a spokesman for LA Care said that their organizations review disciplinary actions on an ongoing basis. LA Care reviews are conducted monthly, and both the Chief Medical Officer and a Credentials Committee review any problems with providers. A Health Net committee also reviews physician discipline to decide whether to continue contracting with a particular doctor.

Both organizations continue to contract with most of the doctors identified by the California Health Report who have medical board disciplinary records and who are still licensed to practice medicine. Three physicians had their licenses revoked, and a fourth surrendered his to avoid prosecution.

For example Hrach Khudatyan, a general practitioner in Glendale who was placed on probation this year for gross negligence continues as an LA Care contractor. Khudatyan’s medical board’s accusation noted that he was overpaid nearly $100,000 for excessive use of ultrasounds. Investigators cited three long-time Khudatyan patients who for years were never referred for ultrasounds until the doctor purchased his own ultrasound machine. After that, Khudatyan performed a total of 60 ultrasounds in three years on those patients, while failing to provide them screening and treatments they actually needed.

Khudatyan didn’t return calls for comment.

One doctor who was placed on probation for prescribing opiates and other drugs to known drug addicts no longer sees Medi-Cal managed care patients, according to his office staff, but still treats children with Medi-Cal who are not in managed care plans.

A Monterey Park pediatrician who was indicted on 55 counts of illegal prescribing, sale of controlled substances, Medi-Cal fraud and insurance fraud is no longer active with LA Care, according a health plan spokesman.

Two other doctors with disciplinary records, both of them elderly, appear to have gone out of business.

The state DHCS reports that revisions to its policy on physician contracting for Medi-Cal managed care plans are expected in the coming weeks, but declined to give reasons for the re-do, or to explain what would be changed.

Brooks argued that the state hasn’t had problems ensuring that doctors correct deficiencies in a timely way, but noted that the agency is working on better use of data to make sure they do so and also continue to comply with requirements.

The Affordable Care Act also has provisions that could help states keep the worst actors out of Medi-Cal and Medicaid programs nationwide. It requires the Centers for Medicare and Medicaid Services to establish an information system so that states can keep physicians who’ve been terminated from a Medicaid program in one state from setting up shop in another.

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