I was disappointed that the article “Managing the Cash Gap” ( JofA , Oct.99, page 27) was allowed to be published with such a blatant, unsubstantiated slam against the HMO industry. The statement that “some health care providers can have 60 to 90 days in receivables, thanks to slow-paying HMOs that actively manage their cash gaps by delaying payments” is uncalled for in a professional publication. We all know that HMOs have become the media’s favorite whipping boy now that other favorites like the tobacco industry are in disarray, but I don’t expect that behavior from the JofA .
I have been involved in HMOs for over 10 years. While there no doubt are some bad apples out there, every HMO I have been involved in has worked hard to get claims paid as quickly as possible. Any additional interest earned on cash flow is not worth the member service and provider service headaches and increased administrative costs due to higher call volumes, member and provider dissatisfaction, and so forth, that result from deliberately slowing claims payments.
Bill Scheerer, CPA