Physician association sues Chinese Community Health plan for fraudulent business practices

August 17, 2015
Area(s) of Interest: Fraud & Abuse Licensing & Regulatory Issues 

The Chinese Community Health Care Association (CCHCA)—a San Francisco independent physician organization representing nearly 200 physicians—has filed a lawsuit against the for-profit Chinese Community Health Plan (CCHP) for deceptive business practices that are putting the future of Chinese Hospital and the health care of the city's Chinese community in jeopardy. The lawsuit, filed August 5 in San Francisco County Superior Court, accuses the health plan of breach of contract and unfair competition, among other things.

According to the physicians, the health plan recently sent individual physician contracts to CCHCA doctors in an attempt to pressure them into signing directly with the health plan, rather than contracting with the plan through CCHCA as they current do. The "participating provider agreements" sent to physicians included language that misled doctors into believing that the contract was simply a renewal of an existing agreement, when in fact it was a completely new agreement that would have legally bound the physicians directly to the health plan, effectively ending their relationship with the physician association.

The lawsuit alleges that CCHP was carrying out a “calculated and well-planned scheme” to put the physician association out of business.

CCHCA was established as a non-profit independent physician organization more than three decades ago to promote social welfare by making health services more accessible to San Francisco's Chinese community. Members of the physician group believe the health plan's deceptive letters will lead to the dissolution of the independent practice association and will destroy the unique health care alliance that has served San Francisco's Chinese community so well for so long—ultimately driving up profits for the health plan at patients’ expense.

“The actions by the management of CCHP will leave our community with fewer doctors and far fewer health care choices,” said Raymond Li, M.D., CCHCA president.

The California Medical Association (CMA) and the San Francisco Medical Society (SFMS) sent a letter to CCHP CEO Brenda Yee, protesting the health plan's attempts to strong-arm physicians.

“It is critical that the health plan respect the important role CCHCA has played in delivering much-needed, culturally appropriate, affordable health care to the Chinese community,” wrote CMA CEO Dustin Corcoran and SFMS CEO Mary Lou Licwinko in a joint letter to the plan. “CMA and SFMS are prepared to support CCHCA and its physicians to continue to achieve its charitable purposes.”

The letter also points out that the physician group has promoted social welfare in San Francisco's Chinatown for more than three decades by providing financial support for health-related community programs, including the Chinese Community Health Resource Center, the Neighborhood Disaster Response Plan and treatment room services at the Chinese Hospital. CCHCA has also provided more than $2 million in direct grants to innovative community projects.

CMA and SFMS also sent a letter to San Francisco state legislators Phil Ting, David Chiu and Mark Leno, who represent San Francisco in the state legislature. “CMA and SFMS are greatly concerned that the health plan’s actions interfere with physicians’ ability to serve their patients, while also diminishing the long, proud history of the Chinese Hospital and the close relationship generations of physicians and patients in San Francisco have enjoyed,” Corcoran and Licwinko wrote in the letter, which was also sent to all of the San Francisco Board of Supervisors and San Francisco Mayor Ed Lee.


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