Rich Pedroncelli / AP Gov. Arnold Schwarzenegger, second from right, discusses healthcare reform in a meeting with Don Crane, president and CEO of the California Association of Physician Groups, right, and other members of the healthcare community in Sacramento on Tuesday.

SACRAMENTO — Gov. Arnold Schwarzenegger on Tuesday assailed Blue Cross of California for attempting to get physicians "to rat out their patients" and said the incident underscores the importance of enacting comprehensive healthcare reform.

In a recent letter to physicians who treat Blue Cross HMO patients, the company sent doctors copies of patients' insurance applications and asked them to report to the insurance company any medical condition that was not disclosed on the application.

"We're going to look at that," Schwarzenegger said. "To break that confidentiality relationship is terrible."

Schwarzenegger made his remarks following a meeting with representatives from healthcare provider groups, including the state associations representing doctors, hospitals and physician groups.

He used the occasion to reiterate his resolve to enact a universal healthcare plan and to say he will not be deterred by a Senate committee's rejection last month of the plan he had hoped to place before voters this fall.

"We're going to press forward," he said. "We are going to have comprehensive healthcare reform even though we had a bump in the Senate."

The rejected reform package included a provision that would have barred insurance companies from denying policies to individuals based on their age or existing medical conditions.

The Blue Cross letter, he said, is further evidence of why such reform is needed and why even Californians who have insurance are sometimes uncertain about their ability to access care.

"People who are not insured have to live in fear, and people who are insured have to live in fear," he said. "That is outrageous."

Dr. Richard Frankenstein, president of the California Medical Association, who attended the meeting in the governor's office, echoed Schwarzenegger's assessment of the letter.

"It will make everyone who sees a doctor have a thought in the back of their mind that maybe they shouldn't tell their doctor something — and it could be the one thing that could save their lives," Frankenstein said.

In a statement released to the media Tuesday, Blue Cross officials said the letters have been part of the application process "for several years" and are intended to ensure that "all medical records are accurate and up to date both for the benefit of our members and the providers in our HMO network."

The company said now that it has been made aware of "concerns" expressed by the CMA, it will work with the doctors' association to address them. It said it sends out about 1,000 such letters each month.

The letter expressly asks doctors to identify any "medical omissions" on the patient's application and reminds them that "Blue Cross has the right to cancel the member's policy for failure to disclose material medical history."

Relations between the company and the Schwarzenegger administration have been strained for the past year, as Blue Cross was the most vocal industry critic of Schwarzenegger's healthcare reform plan.