Fragile Bulwark


Editor, Professional Licensing Report

"Man is born free, but everywhere he is in chains." That's what the philosopher Jean Jacques Rousseau said, more than two hundred years ago. Of course, Rousseau could not have known about the chains that dominate our lives today, not just the Safeways, the Nordstroms, and the Targets, but the category killers: the Home Depots supplanting the local hardware stores, the Borderses replacing the independent book stores, the Wal-Marts edging out the local retailers that are left over.

For a long time, professional services were relatively immune from this trend toward homogeneous efficiency, helped in many cases with state bans on corporate practice. Of course, we've become accustomed to chain stores in pharmacy and optometry. But most of us did not foresee a chain store in nursing.

There is one, it's called Access Health, and it has more than 4 million customers. A publicly traded company that had $104 million in revenue last year, Access Health fields calls from members of health plans through its service known as "nurse on call." Its contracts with managed care plans cover 28 million people. In Pennsylvania, the service is being promoted as "Blues on call," because the nurses,500 of them, actually located in Denver, Sacramento, Chicago, and Phoenix, perform a referral function for Highmark Blue Cross Blue Shield.

After the patient describes his or her symptoms, the Access nurses go down an elaborate list of questions, assembled by physicians, to determine what care would normally be prescribed: self-care, a visit to a primary care doctor, a trip to the emergency room, or a visit to a specialist. Another Access Health service is Personal Health Advisor, under which patients can call nurses to get information but not referrals.

Physicians with the Pennsylvania Medical Society have said nurse-on-call services threaten both primary care physicians' practices and their patients and are essentially a form of practicing medicine without a license. They also suggest the nurses employed by Access Health could be told to channel patients to specialists whose practices are deemed "cost-effective", regardless of quality. Blue Cross Blue Shield says, however, that nurses-on-call are not practicing medicine any more than the nurses who answer the phone in a doctor's office or the people who staff a doctor's answering service at night.

Yet to be dealt with is another issue. If the nurses are answering the phones in four sites for patients located in the 50 states plus D.C., they would be practicing nursing without a license most of the time. The company claims that it complies with state laws by assuring the nurses are licensed in the state from which they pick up the call: Colorado, California, Illinois, and Arizona. But at least on the books, the laws specify the license must be where the patient is located.

Whatever licensing's flaws, it gives public agencies some regulatory control over professional practices; it is a fragile bulwark against exploitation or malpractice that can have grave consequences for people's physical well-being and finances. That's why so many state legislatures are considering bills that would require directors of managed care plans to be licensed to practice medicine and surgery.

For example, a measure pending in Ohio, a large managed-care consumer protection act, would define a medical director as the party responsible for treatment policies, assuring quality, and making management decisions for a managed care plan, and say that person is under the jurisdiction of the medical board.

Supporters of the requirement say medical directors are practicing medicine. Opponents in the insurance business agree medical directors should be held to the same credentialing standards as other physicians but are simply determining coverage and providing information to physicians. A spokesman for United HealthCare of Ohio Dayton contended "medical directors don't need to be licensed in each and every state." Look for the state-regulated insurance industry nationwide to put up a ferocious battle against provisions subjecting it to medical-board scrutiny.

Funeral services was an area so rampant with abuse of consumers that the Federal Trade Commission imposed the Funeral Rule in 1984, forcing funeral directors to make certain price disclosures. But a wave of consolidation in the death care industry appears to be making the whole issue of price competition moot. State Senate researchers in Florida found in October that one corporation, Houston-based Service Corp. International, owns as many as 80% of the funeral homes and related facilities in some popular retirement areas.

The interesting thing is that the companies typically don't disclose their ownership, so consumers might check and compare prices at several funeral homes without realizing they're owned by the same company. Even legislative researchers couldn't tell exactly which of Florida's 800 funeral homes are owned by some of the death-care consolidators, because licensing regulators don't keep ownership information. Key state senators have said some companies are jacking up prices and deliberately disguising their ownership so that consumers will think the funeral homes are still family-owned and operated.

Complete disclosure of ownership of the companies should be a minimum requirement, says one former chairman of the Senate committee overseeing professional regulation, but may not be politically possible to get, because the death industry "is really a tough nut" to crack. The chief executive officer of Equity Corp., another funeral-care giant, says that mandatory ownership disclosure could unfairly harm both the chains and the independent owners who sell to them, by robbing them of the valuable goodwill that the independent owner has built up.

Ironically, this CEO makes an important point: good will is very hard to buy, no matter how large a corporation you are. It is easier to acquire if you are a person, not just an entity. But the Senate report also reflects how increasingly difficult it has become for state legislators to maintain control over services that traditionally have been regulated by state licensing boards.

Whether it is by choice or because of lack of choice, once people start turning to corporations when they need any professional service, the role of state licensing boards could be sharply diminished, if they have any role at all. If you still believe there is a future for professional licensing, this may be a good time to get the T-shirt that says, "Friends don't let friends shop in chain stores."