State fines Kaiser again - The HMO's second such penalty in a year targets its handling of patient complaints at nine hospitals.

The California Department of Managed Health Care said it will levy a $3-million fine against Kaiser, the largest HMO in the state, with 29 medical centers and more than 6 million members. If Kaiser makes necessary improvements, agency director Cindy Ehnes said, she will forgive $1 million of that.

The penalty marks the second time in a year that Kaiser has been publicly rebuked and fined for glaring breakdowns in oversight.

The state's latest inquiry grew out of its investigation into problems that forced the closure last year of Kaiser's kidney transplant program in San Francisco. Hundreds of patients were endangered when Kaiser forced them to transfer to its own fledgling program from established transplant centers at outside hospitals.

Last August, the state fined Kaiser $2 million for the transplant debacle, and the HMO agreed to pay an additional $3 million to promote organ donation.

Even then, Ehnes said, the question remained: "How could it happen?"

To answer that question, the state focused on whether Kaiser was properly handling -- or even knew about -- allegations of subpar care at its hospitals statewide. Inspectors examined 246 files involving complaints, quality-of-care concerns and other issues from four hospitals in Kaiser's Northern California region, and four in its Southern California region.

The investigation did not examine whether individual patients had been harmed, only on how well Kaiser monitored the quality of patient care.

"A patient has to be sure that if they have a problem

A top Kaiser official on Wednesday called the state's 51-page inspection report "thorough and actually very constructive."

The managed-care agency found that under the HMO's massive umbrella, individual hospitals had their own rules: Some rigorously pursued potential medical mishaps; others did not.

The vast majority of the report focused on a system called "peer review," a standard quality-assurance mechanism at hospitals in which doctors' committees examine patient cases to determine if the care was appropriate.

Inspectors found large differences among hospitals in how often questionable cases were being referred for peer review. In Northern California, one hospital might refer as much as 20 times as many cases as another.