President's Message
Positive New Directions

By Samuel Wilson, M.D.

Because it is the beginning of a new year, it is appropriate that I take this opportunity to announce two positive new directions for the San Bernardino County Medical Society (SBCMS) in 2004: 1) the sale of our building and consideration of renting office space from the Riverside County Foundation for Medical Care (RCFMC); and 2) partnership with the RCFMC to manage the San Bernardino Foundation for Medical Care and bring more patients to your offices.

Whenever there is change something is lost and something gained and of course some aspects of our operations remain unaltered. Inevitably we give up something of our selves to gain some other benefit. A true and accurate assessment of what is gained, what is lost and the things conserved allow us to navigate the transition and orients us to our new status.

SBCMS owns a 19,500 sq. ft. building of which it occupied 5,566 sq. ft. Over 4,500 sq. ft. was used as conference meeting rooms and a lobby that house our medical museum. That building was sold on December 31, 2003 and SBCMS signed a 6-month lease for 5,566 sq. ft. with the new owner. SBCMS cleared $834,000 on the sale. How did we get here? In the late 1990's operating the building was a financial drain on the Medical Society as there was a glut of available office space in the Cooley Ranch area of Colton and our building was nearly 50 percent vacant. At that time we gave a new tenant, who agreed to lease over 6,000 sq. ft., a lease with the option to purchase the building if the tenant was current in their rent and exercised the option during the first five years of the lease. That tenant now occupies over 9,000 sq. ft. and has exercised the lease option to purchase. SBCMS reluctantly sold our building. The sale was complicated by a legal challenge that the Medical Society lost.

For several months the SBCMS Board of Directors and Executive Committee have spent considerable time discussing and evaluating the various opportunities the sale of the building will afford us, one major advantage being the release from the headaches of property management and considerable expenditures in terms of both budgetary and staff time relating to the maintenance and operation of our aging building. As I write this column, the Board of Directors, together with Executive Director Linda Stratton and our professional consultants, continue to explore our best options in regard to the future location of the Medical Society and its two 501(c)(3) organizations - Inland Wellness Information Network (IWIN) and the Physicians Memorial, Gift and Benevolence Fund (PMGBF) and its Medical Museum. Although many of the details remain to be worked out, I will continue to share what I know with you, my SBCMS colleagues, through this monthly column and personal correspondence as decisions and arrangements are finalized. In the interim, I want to assure you that the sale of our building will not disrupt nor diminish the services, benefits, and advocacy that SBCMS has always provided its membership.

One location under consideration is sharing the building that houses the Riverside County Medical Association (RCMA) and that is owned by their successful Riverside County Foundation for Medical Care. The building is only 9.5 miles west of our present location and has 3,000 sq ft of vacant office space we could rent for about half of what we would be charged in our current location. Furthermore, RCFMC is willing to share in the cost of a 2,000 sq. ft. conference room that would be used by the two medical associations, the RCFMC and our medical museum. The long term potential for cost savings by the two associations sharing space is significant. The RCMA and their RCFMC's offer is generous and accommodating.

I am also pleased to announce that we are working with the RCFMC, http://www.cfmcnet.org/HCFSC/RCFMC/Default.htm, to bring the former San Bernardino Foundation for Medical Care (SBFMC) under the management of RCFMC. This effort will bring more patients to your offices and provide excellent service to physicians, hospitals, clients and patients. Membership in the Foundation for Medical Care will be a benefit of your SBCMS membership and will be available at no cost to you. Non-member physicians pay $450 per year to belong. RCFMC directs patients to the offices of participating members through its contracts with employers, insurance carriers, self-funded employer groups and other health care purchasers. It presently has contracts with several school districts and municipalities.

A quick history lesson for my younger colleagues on the old San Bernardino County Foundation for Medical Care:
(http://www.futureofchildren.org/information2827/information_show.htm?doc_id=73457)

Foundations were developed as an alternative to the prepaid group practice plans such as the Kaiser programs, and Ross-Loos clinics during the 1920s to 1940s. The developers of the prepaid group practice plans solved the problem of people having to find money when ill (through prepayment) with the ease of medical record sharing in the multispecialty practice in one location. Their physician panels however were limited or closed so patients could not necessarily choose their physicians.

By the early 1970s there was increasing evidence that group practice prepayment plans, or prepaid group practices (PGPs), took care of their populations at a substantially lower cost than-and with comparable quality to-fee-for-service providers. The Nixon administration wanted to encourage people to enroll in such prepaid plans as a cost-containment measure, but faced stiff opposition from organized medicine, which found the idea of prepaid group practices an anathema.

There were, however, some examples of medical society sponsored plans that accepted financial responsibility for the review of services delivered by their members. These "foundations for medical care" (FMCs) were acceptable to the American Medical Association (AMA), probably because of their relatively open panels, which included nearly all the physicians in a geographic area.

Most senior physicians will recall that in the 1950s "Socialized Medicine" (pre-paid plans) and medical cost containment had become a very popular topic and cause. The Foundation model is a doctor organized, directed, and managed effort to protect the interests of the patient, the insurance carrier, and the doctor. The idea was to review all claims so that none of the three would be abused and each would fairly benefit. SBCMS inaugurated the original San Bernardino Foundation for Medical Care (SBFMC) on April 9, 1959. All SBCMS member physicians were invited to participate and agree to accept the actions of the SBFMC in the submission and payment or adjudication of their claims for fees.

The early going was rough and progress slow. The actual work of the SBFMC - that of practice review and recommendations on claims - was performed almost single handedly by Dr. Merlin Hendrickson with the help of some close associates.

The SBFMC flourished for many years under its Executive Director Janet Lang. Administering claims for Blue Cross was 80% of the SBFMC's activity. However, when new leadership came to Blue Cross, changes were made to include discontinuing the claims processing function of the foundation and drastically reducing fees. By May 1, 1988 there was no more work with that carrier. In August the SBFMC moved from its 10,000 sq. ft. office building to the SBCMS offices with a staff of five. As of 1991, the SBFMC no longer processed claims. It offered services in peer review, utilization review and a provider network (panel of physicians, allied health providers, and hospitals).

In 1995 the SBFMC was sold to the San Diego FMC. Shortly thereafter, SDFMC was taken over by the Sonoma FMC who later became the Pacific Foundation for Medical Care (PFMC) (http://www.PFMC.org/fndtn.html). San Bernardino County physicians have been with the PFMC since. Unfortunately, PFMC has been unsuccessful in signing network contracts to provide patients to doctors in our county. Physicians question why they should belong to PFMC, pay membership dues, and not receive patients. The majority of patients seen by San Bernardino County physicians, through the Foundation connection, are a direct result of business through the RCFMC.

The SBCMS Board of Directors feel the physicians in San Bernardino County would be better served by associating with RCFMC rather than PFMC. The RCFMC office building is just 9.5 miles from our present offices and we have a long-term working relationship with the Riverside County Medical Association, which is also a tenant of RCFMC.

The RCFMC is a successful organization; it currently has a network of 650 providers (PPO, EPO, W/C) and is a California licensed third party administrator (17,000 lives) (http://www.cfmcnet.org/HCFSC/RCFMC/Philosophy.htm). In 2002, the RCFMC processed 206,000 claims totaling over $60 million dollars. A request was submitted to PFMC to terminate the CFMC related network in San Bernardino County and assign the membership agreements, contracts and credentialing files to the RCFMC who would then be responsible for managing the San Bernardino County network as part of its relationship with the California Foundation for Medical Care (CFMC). PFMC has since contacted the RCFMC to negotiate the selling price of the San Bernardino panel. The SBCMS Board has also indicated their desire to hold a seat on the RCFMC Board when they manage the San Bernardino network.

Joining the RCFMC makes it a stronger organization. It will bring more patients to your offices and provide excellent service to physicians, hospitals, clients and patients. Like the other 19 foundations, RCFMC supports quality medical care and reasonable control. I like win-win situations, and this is one for San Bernardino County physicians. As always, I look forward to your feedback.

Doctor Wilson's Current Reading List:
Madam Secretary: A Memoir
by Madeleine Albright