Faced with falling rates in government sponsored insurance programs like Medicare and Medi-Cal and a confusing managed care payment system, California physicians have after years of fighting with insurance companies managed to make some inroads with their payers, although advocacy groups say doctors need to keep a watchful eye to make sure insurance companies make good on their promises. The California Medical Association spent much of this last year arguing that no matter how ingrained managed care has become in the country’s health care systems, doctors should not be stuck wondering when, if and how much of their bills to insurance companies are going to be paid, and with which companies they are contracted to give care. Plaintiffs, who include over 700,000 physicians across the country, reached settlement agreements with several of the largest health insurers, including Woodland Hills-base Health Net and Blue Cross of California owner WellPoint. Nileen Verbeten, vice president of the CMA’s Center for Economic Services, said insurance companies need to understand that doctors can’t keep practicing without knowing if they’re ever going to get paid in full. Treatments are assigned thousands of different codes by insurance companies that are used to determine how much physicians will be paid. “The combination of them is almost unlimited, and every payer has in the past had its own rules about how it would pay those codes when they were presented. In many cases those rules had no logical basis beyond the fact that they just didn’t want to pay,” said Verbeten. “In some cases, not even a payer would know how much they were going to pay. Most businesses are not confronted with the problem of when they send out a bill they have no idea about the basis of how it’s going to be paid even with the presence of a contract.” Doctors, she said, need to continue pushing insurance companies to live up to the promises that they’ve made regarding prompt payment and providing clearer information about reimbursement policies. Payers, she said, may not rush to make changes unless enough doctors voice their complaints. When WellPoint reached its agreement with the CMA and other groups, the medical association’s president said that the public was being willfully deceived by insurance companies. “CMA began the battle against the then-WellPoint, California’s largest for-profit health plan, five years ago, when it became obvious that insurers promised patients one thing in order to sell a policy and then were doing the opposite when it came time to deliver health care,” said Dr. Michael Sexton, the group’s president. Agreement Under the agreement, the company was required to allow physicians to use their own judgment in deciding what care is medically necessary and at which point using cheaper alternatives would affect a patient’s health. It will also have to keep its computer systems from routinely denying payment for multiple procedures performed on the same day, improve its arbitration system and rewrite its explanation of benefit forms to get rid of negative language about physician fees. In discussing the details of the case, Verbeten noted that insurance companies were unwilling to admit in their settlements that they were wrong in their dealings with physicians, and CMA CEO Jack Lewin said that WellPoint allowed its relationship with physicians to deteriorate. WellPoint spokesman James Kappel said that the agreements the company made, such as paying electronic claims a maximum of 15 days after they are filed and paper claims no later than 30 days after they are filed, are improvements the company had already been planning. “The agreement we reached earlier this year reinforces a number of current efforts,” said Kappel. “All of these efforts are going to enhance our working relationships with our physicians.” Kappel said the company did not see the settlement as an admission of any wrong-doing on its part. “It represented a means to end the litigation, so that we can create more efficiency in medical practice that allows physicians to spend more time with their patients which ultimately benefits all of us,” said Kappel. If doctors find that private insurers are failing to live up to their promises, the CMA has vowed that it will support its members and help make sure the companies are held to new standards. Verbeten said that it won’t take many physician complaints before the insurance companies are held to their word. Even as physicians have made some head way, at least on paper, in their position with private insurers, there was bad news from the governor’s office earlier this month. Rate cut Gov. Schwarzenegger announced that Medi-Cal providers will see their rates cut by five percent in the coming year. The rate cut was approved under Gov. Gray Davis but was stuck in the court system until now, and Schwarzenegger received some criticism from Democratic legislators for going ahead with the cut even though the state’s financial situation has improved. The CMA reports that the rate reduction will serve as one more barrier for California doctors, who are paid the lowest rate of any state. The group said that half of the states’ Medi-Cal doctors have dropped out of the program because they are financially unable to keep treating patients as rates fall. Meanwhile, the association is also awaiting a solution for one of the most complicated private insurance problems facing physicians known as “silent PPOs.” The term refers to “leased PPO networks,” of which more than 100 exist in California. The networks contract with physicians, but lease the rate to other entities, and are not required to pay the physician, only to make best efforts to secure payment from third parties. As a result, physicians are often contracted with groups they know nothing about, and are often left without payment. The group is supporting legislation introduced by Assemblywoman Wilma Chan (D-Oakland) that would require the PPOs to get permission from doctors before selling names to other payers and for the networks to give doctors specific information about the payer.
