Down but Not Out, California Again Watched by Industry

John A. Marcille

Every once in a while, we here at Managed Care methodically — sometimes agonizingly — piece together a theme issue in which two or three articles focus on a single topic or on related topics. This usually takes planning, coordination, and insight. Or, we stumble into it, which seems to be what happened this time.

Welcome to California, which, while maybe not strictly a theme, certainly has been accorded the honorific “state of mind” once or twice. (Senior Editor Mike Dalzell, himself a Californian, heartily attests to this characterization.)

Mike writes of the alarming financial troubles plaguing physician groups in the Golden State. Some of the causes are rooted in factors germane to California's signature model of care delivery, the large multispecialty practice — and so while these ills may not befall groups in other states, there are lessons for physicians, health plans, and employers alike. (The flip side of insolvency — that of health plans — is addressed in our States Initiatives column.)

In our popular Q&A feature, meet Walter A. Zelman, Ph.D., head of the California Association of Health Plans. Zelman was, at one time, a consumer-rights activist who advocated a government single-payer system. Gradually, however, he came to see managed care as the great hope for saving money and coordinating care; communicating that vision, though, will require dealing with that pesky image problem.

Our tour then circles around to writer Karen L. Trespacz's lively cover story on the ifs, ands, and buts of consolidation. While this, strictly speaking, is not solely a California story, you'll notice that Zelman makes a prominent appearance here — noting that California, with five or six dominant plans, remains one of the more competitive markets in the country.

How these issues play out in California will, of course, have bearing on the rest of the country. That's why, as theme issues go, this one's not bad. Not that we planned it that way.