Blue Cross cuts could mean less doctor time for patients

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North County Times (San Diego, CA)

SAN DIEGO, CA — Looming reimbursement cuts from Blue Cross of California could mean that doctors will be spending less time with patients, a local doctor said last week.

Reimbursement rates are what insurers pay contracted doctors for specific services ranging from routine office visits to surgical procedures and everything in between.

Officials for Blue Cross, the second largest private insurer in California and third largest in San Diego County, said they had cut some reimbursement rates but increased others. They also said that they were cutting rates to protect customers by keeping health insurance as “affordable as possible” while earning a modest profit.

Dr. Ted Mazer, the immediate past president of the San Diego County Medical Society, said the rate cuts could cause “fed-up” doctors to leave Blue Cross altogether. Or, prodded by reduced reimbursements and rising costs, doctors could try to keep their revenues up by seeing more patients each day — but spending less time with them.

Meanwhile, officials from California’s Department of Managed Health Care, the agency that doctors asked to intervene, said they had no control over rates.

Mazer said doctors are particularly unhappy because they, and consumer groups, believe that Blue Cross is cutting what it’ll pay doctors and jacking up premiums for patients and shipping the profits out of state.

Blue Cross is owned by Wellpoint, which was acquired in a $16.4 billion deal in 2004 by Indianapolis-based Anthem Inc. To get approval for the deal, Blue Cross promised to ensure that cash from health care premiums was spent on health services, to increase access for Californians, and to make sure Californians benefited from the deal.

Last week, the Managed Health Care Department held a forum in Los Angeles at which hundreds of people — some holding placards stating, “Blue Cross makes me sick” — protested the rate cuts, complained about personal contentions with the agency, and testified about the allegations that Blue Cross was hurting Californians financially.

Jerry Flanagan, health care policy director with the Foundation for Taxpayer and Consumer Rights, testified that Blue Cross had shipped $6.5 billion out of the state between 2004 and 2006.

“We have no idea where that number came from,” Blue Cross spokeswoman Peggy Hinz said Friday. “We don’t have details on where that came from.”

Hinz said that Blue Cross did send a $950 million dividend to investors back east earlier this year.

Flanagan, however, said that Blue Cross had been hiding other payments by shipping them to sister companies under the guise of doing work for Blue Cross.

“I’ve sent them my analysis,” Flanagan said. “They just don’t want to talk about it.”

Earlier this year, Blue Cross was fined $1 million by the Managed Health Care Department for a different issue, rescinding the policies of individual members who filed claims. The company denied any wrongdoing, but said it had changed its policies.

Meanwhile, Mazer and members of the California Medical Association said that Blue Cross had been paying doctors “unconscionably low” rates — sometimes lower than Medicare rates — while increasing what it charges people for insurance premiums more than other insurance companies.

Medical Association officials also charged that Blue Cross refused to pay for patient care after pre-authorizing the care and rescinded people’s health plans retroactively.

Blue Cross actually planned to implement its new rates July 1, but agreed to delay doing so when doctors across the state complained they had not been notified, Mazer said.

The company now plans to put the new rates into effect Aug. 30, but Mazer said some doctors have already received payments from the company under the new rate system, according to Hinz.

Mazer said doctors could eventually reach their breaking point, “vote with their feet,” and leave Blue Cross.

He said that California Medical Association polling suggested that doctors representing 90,000 patients statewide had already said they wanted to quit. That could leave those patients looking for new doctors or leaving Blue Cross as well.

But because Blue Cross is so powerful — it represents more than 8 million customers, 16.7 percent of the market and more than 53,000 doctors — a mass exodus of physicians seems unlikely.

Hinz said Friday that fewer than 1 percent of doctors in the company’s network had asked to quit.

What might be more likely than doctors quitting, Mazer said, is that patients will feel the “trickle down” effect.

“The public is already very unhappy that they only get five to 10 minutes face-to-face with doctors,” Mazer said. “Our costs keep escalating… cuts in payment in a business model means you’ve got to have more production. That means you’ve got to see more patients in the same amount of time.”

For its part, the state’s Managed Health Care Department said it’s received more than 4,100 complaints from health care providers about Blue Cross since the 2004 merger — despite Blue Cross‘ public statements that the deal would improve service and care in the state.

Spokeswoman Denise Schmidt said the agency would continue to investigate allegations that Blue Cross is not adhering to the promises it made in 2004.

But Schmidt said the agency had no control over the doctors’ reimbursement rates.

“Yeah, those are a done deal,” Schmidt said.

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