Managed care liability and the capitated provider.

While there have been no reported cases as yet on the subject of ERISA preemption of claims arising from utilization review decisions by providers, it will unquestionably be a significant issue facing providers that participate in capitated arrangements. If preemption is determined not to be available, providers will be exposed to risks from which health plans are currently shielded. Providers conducting utilization review should be following this issue as it develops, but should also be obtaining insurance for this risk to the extent it is available (e.g., it will not be available for punitive damages). Providers should also consider negotiating provisions in their contracts with health plans to the effect that any utilization review conducted by the provider is on behalf of the health plan and that the provider's utilization review activities will be covered under the health plan's liability insurance.

Special report on reimbursement. HCFA enacts new enforcement remedies covering nursing facilities.

While the regulations are revolutionary in their use of "substantial compliance," the interpretation and application of HCFA's new remedial scheme are still uncertain, as states are given broad discretion in defining important terms and in applying and interpreting the criteria to select remedies. Further complicating the issue is the fact that some states, including California, intend to seek waivers from HCFA to substitute their own state enforcement systems for most, if not all, of the new federal system. Based upon these uncertainties, the enforcement of nursing facility standards will likely be in a state of flux for some time to come.

Recent state legislative approaches to regulating utilization review reflect URAC national standards.

As state legislatures begin to regulate utilization review activities, some appear to be utilizing the URAC standards for guidance. Still others (e.g., Iowa, Nebraska, and New Hampshire) require URAC accreditation as a prerequisite for utilization review organizations to operate in their states, while others (e.g., Alabama, Arizona, Connecticut, Indiana, North Dakota, Tennessee, and Rhode Island) accept URAC accreditation in lieu of state certification. "States Look to Accreditation for Managed Care Seal of Approval," Medical Utilization Review, Vol. 22, No. 20, Oct. 27, 1994, at 7-8. The remarkable consistency between the 1994 URAC standards and the new California law are a hopeful sign that managed care decision-making will in the future be undertaken on a more uniform and objective basis. Only through this type of consensus building will the historical chasm between providers and payors be made smaller.

State legislative approaches to regulating coverage for experimental procedures.

As addressed in past issues of the Newsletter, the Employment Retirement Income Security Act ("ERISA"), 29 U.S.C. sections 1001 et seq., limits the ability of states to regulate the terms and conditions of group health plans. See Newsletters, Vol. 8, No. 6, June 1993, at 6 and 23; Vol. 8, No. 1, January 1993, at 7; Vol. 7, No. 2, February 1992, at 13; Vol. 6, No. 11, November 1991, at 3. Under ERISA, states cannot mandate that self-insured group health plans or employers provide specific types of coverage. Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 105 S.Ct. 2380 (1985). Such mandates are enforceable only as to insurance companies and HMOs, and only to the extent that they are deemed to "regulate insurance." Id. As a result, state legislative attempts to regulate experimental treatment insurance coverage have largely been limited to health plans that are not self insured. Given the inconsistent handling of experimental treatment insurance coverage by both insurance companies and courts across the nation, state legislatures have demonstrated that they are ready to address this matter themselves. However, unless ERISA is amended to afford employees with self-insured plans the same protections as those with insured plans, such state efforts will not be able to resolve the problem for all citizens.

Special report on liability and insurance. An update on assignment of patient benefits under ERISA.

While the holdings in Davidowitz and Arkansas Blue Cross & Blue Shield arose in different contexts, they both reflect the courts' increasing willingness to consider the importance of cost containment in the health insurance arena, even though patient accessibility to health care may be restricted as a result. If the holding in Davidowitz is not successfully appealed, providers may need legislative relief in order to retain their ability to take valid assignments of patient claims for payment from ERISA plans. It is uncertain whether such legislation can be sought at the state level or must instead come from Congress due to ERISA preemption of state legislation. Clearly, the district court decision on remand in Arkansas Blue Cross & Blue Shield will be closely watched for any light it may shed on this question. On a pragmatic note, providers who have not entered into "participation" agreements with insurers or other private payors may now have a greater incentive to do so, and "nonparticipating" providers who continue to obtain assignments from patients in order to collect directly from insurers or other private payors should determine on a case-by-case basis whether the source of the patient's benefits is a group health plan--which is likely to fall under ERISA and may contain nonassignment provisions--or some other form of coverage. For an additional perspective on insurers' responses to copayment waivers, see Newsletter, Vol. 6, No. 10, October 1991, at 7.

Immunoaffinity purification of tissue plasminogen activator from serum-supplemented conditioned media using monoclonal antibody.

Tissue plasminogen activator (tPA) was purified from serum-supplemented culture media in a single-step immunoaffinity chromatographic procedure. This was done by producing a monoclonal antibody to tissue plasminogen activator. The antibody is a murine IgG1, kappa light chain molecule. The antibody was coupled to CNBr-activated Sepharose 4B. Tissue plasminogen activator was isolated from serum supplemented tissue culture media by immunoaffinity chromatography using a relatively high ionic strength equilibration buffer and an acidic elution buffer.