Testimony for Texas Senate Health and Human Services Committee, Texans for Patient's and Physician's Rights
 Steven F. Hotze, M.D.
May 12, 2010
The hallmark of a free society is demonstrated by a government which is transparent in its actions and transparent in its dealing with the citizens. In this environment, liberty thrives.
Senators, I am Dr. Steve Hotze and the founder of Hotze Health and Wellness Center, Physicians Preference Vitamins and Hotze Pharmacy all located in Katy, Texas. Our center has been in operation for 21 years. We have served over 20,000 patients and have approximately 80 members on our staff. Thank you for the opportunity to appear before you.
Senators, there appears to exist several significant problems in the Texas Medical Practice Act which cloak the complaint process in secrecy and have led to abuses. We are here today to seek your counsel and to request for your help in correcting these problems..
The Texas Medical Practice Act currently allows any individual to file a confidential complaint against a physician without the accused physician being permitted to read the complaint or know who filed it. The complainant’s identity remains anonymous to the accused physician, although not to the Texas Medical Board (TMB).
These types of complaints are filed by competitors, attorneys, insurance companies, hospitals, pharmaceutical companies, disgruntled employees, and ex-spouses among others.
Many of the complaints filed against physicians appear to be malicious. Once the complaint is filed experts are hired by the TMB to review the record and tend to discredit the physician. These experts are anonymous to the accused physician, but the physician’s identity is known to the experts. Secret proceedings, known as Informal Settlement Conferences (IFC), are conducted without providing the same legal due process that is afforded to common criminals. The physicians are intimidated and often forced to sign agreements under the threat of license revocation.
The injustices of the TMB’s complaint process have been the concern of legislators for a number of years. Former Speaker Tom Craddick issued an interim charge to the House Appropriations Subcommittee on Regulatory to investigate the TMB. That committee hearing was conducted under the chairmanship of Fred Brown on October 23, 2007 and lasted nearly 12 hours. Hundreds of physicians and patients filled the hearing room in opposition to the tactics being used by some members of the TMB. Under intense questioning from State Representative Debbie Riddle, the former president of the TMB, Roberta Kalafut, admitted that she had her husband, Dr. Brandecker, file a confidential complaint against another doctor in her area. Interestingly, 12 of Dr. Kalafut’s competitor physicians had confidential (anonymous) complaints filed against prior to her resignation from the TMB.
You have previously heard the sworn testimony of Dr. Kalafut’s former associate physician, Dr. Dan Munton, as it relates to the unethical and unprofessional actions of the former President of the TMB.
I have practiced medicine in Texas since 1976. Prior to April 2007 I had never had a complaint filed against me with the TMB. Then out of the blue I had 4 anonymous/confidential complaints filed against me within 17 months. The first complaint, dated April 7, 2004, was about advertising. Since March 2001 I have hosted an hour long radio program on KSEV at noon, Monday – Friday. I also published a book, Hormones, Health and Happiness, in April of 2005. After the book was published I had two (2) more complaints filed with the TMB on advertising, June 17 and August 4, 2005. Then I had a final confidential (anonymous) complaint filed against me by another doctor on the medical care I had provided a woman who happened to be a close friend and my longest standing patient of over 20 years. All these complaints were dismissed but not before I had spent well over $100,000 in legal fees. One board member commented during my first ISC that 99% of complaints over advertising were filed by competitors..
This may sound like the system worked but I can assure you that many smaller practitioners would have been intimidated and lost these cases.
Nolan Shipman, M.D., an ENT surgeon in College Station, notified me that during his ISC hearing on January 19, 2005, Larry Price, D.O., who was at that time the Vice President of the TMB, made a comment to him that was totally unrelated to his practice and the matter pending in his case. Dr. Price stated that he was aware of doctor in the Houston area that had his own pharmacy and vitamin supplements. Dr. Price told Dr. Shipman that this Houston area doctor advertised in Southwest Airlines Magazine and that “we (TSBME) are going to get this guy.”
Dr. Price was talking about me. That’s a little disconcerting. You have to wonder what his agenda was. Dr. Price has since left the TMB.
By allowing confidential/anonymous complaints by insurance companies, the Texas Medical Practice Act provides ways for insurance companies to game the system. These anonymous complaints target physicians who oppose the insurance companies’ “standards of care” which limit treatment options, deny claims and increase insurance company profits. These physicians, whom the insurance companies have targeted, are often destroyed in the ISC. This is meant to teach a lesson to any physician who would dare challenge the insurance companies’ policies on patient care.
It is unconscionable that the insurance companies receive the benefit of confidentiality at the expense of the patient-doctor relationship.
Dr. Keith Miller, former member of the TMB, also served for Blue Cross-Blue Shield on the Texas Medical Advisory Committee, which frequently finds itself in a position adversarial to physicians in matters of patient care versus profits. This was clearly a conflict of interest. It was Dr. Miller who presided over the Informal Settlement Conference of Dr. William Rea.
Dr. Rea is a board certified cardiovascular surgeon who established the Environmental Health Center in Dallas, Texas in 1974. Dr. Rea provides innovative treatment to patients plagued with environmental illnesses stemming from exposure and adverse reactions to chemical toxins and allergens. He has published over 135 medical journal articles and has written the definitive four volume textbook on environmental illnesses. Since 1974 he has served over 30,000 patients from around the world.
In 2005 Dr. Rea was informed by the TMB that an anonymous complaint had been filed against him for his treatment of five patients, all living in Manhattan and all covered by Oxford Medical Insurance. It became obvious that Oxford, an out-of-state insurer, filed the anonymous complaint to shut down Dr. Rea so that it didn’t have to reimburse his patients.
When the patients were informed about the anonymous complaint, they were appalled. Each wrote letters to the TMB praising Dr. Rea’s treatment. Two of the patients credited him with saving their lives. As in other cases, the TMB completely disregarded the patients’ testimony.
Dr. Rea presented written exoneration from 18 physicians in his field. The TMB’s anonymous “expert”, ignorant of environmental medicine, reviewed the patients’ cases and condemned him. That’s 18 experts for Dr. Rea and one (1) anonymous non-expert against him.
At the Informal Settlement Conference hearing, lasting less than one hour, Dr. Miller refused to consider Dr. Rea’s extensive rebuttal documents and told him that he would make sure that his license was revoked. That’s insurance company justice, executed by unelected officials at the TMB. It creates a stifling atmosphere in Texas which discourages innovation and fosters mediocrity.
Now insurance companies are using the Texas Medical Board (TMB) as their rifle to target physicians who refuse to submit to their dictates. The insurance companies want to force doctors into compliance or drive them out of practice.
The TMB was established to protect citizens from physicians who engaged in disreputable conduct or whose treatments were harmful. Its processes should not be used for the business agendas of insurers or competitors.
This happens without a patient filing a complaint. The patients are unaware that their insurance companies are interfering with their medical care. When they become aware of the situation, most patients sign affidavits stating they are pleased with their doctor’s treatment. Amazingly, the affidavits are disregarded by the TMB.
The TMB pays so called “expert” doctors to review the records of the patients whose treatments are under question. Amazingly, the Board is under no obligation to disclose to the doctor when an expert finds in his or her favor.
When you stand back to look at the larger picture here, you can see a defendant doctor accused in a complaint he is not allowed to read and filed by someone he cannot identify, held in judgment by an expert unknown to him, and unaware that another board expert has found the care to be good.
The results of these unjust investigations are 1) the reputation and the livelihood of the accused physician has been jeoparized, 2) the TMB adds another physician to the list of those it has disciplined, justifying its need for increased funding, and 3) the insurance company has used the TMB to force another doctor into submission.
It seems to me that a system for filing and prosecuting complaints against physicians that is cloaked in secrecy allows the opportunity for individuals, whose characters are less than honorable, to use that system for their own personal gain.
Please allow me to recommend that you consider revisions to the Texas Medical Practice Act which might include the following:
1) Ensure transparency of charges and proceedings,
2) Provide the physicians with a copy of the complaint and the identity of the complainant. Confidentiality of the complainant should only be considered in rare, narrowly-tailored circumstances,
3) Eliminate the acceptance of truly anonymous complaints, where the identity of the complainant is unknown even to the board,
4) Eliminate the anonymity of expert witnesses, and provide that all expert reports are shown to the defendant doctor,
5) Allow physicians to use computers for notes and recordings during ISC hearings,
6) Eliminate discipline for menial and trivial records findings,
7) Ensure random assignments to the Informal Settlement Conference (ISC) panels, and
8) Prohibit conflicts of interest of the TMB members.
Senators, thank you for your consideration of these recommendations. I will continue to make myself available to you and to the Texas Medical Board to work on these and other issues to provide for a stronger yet fairer Board process.
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