Physicians Blame Mergers for Contract Disputes With Insurers
Several years after major mergers among health insurers, physicians and consumer groups continue to raise concerns over low reimbursements and lack of competition among insurance companies, the San Francisco Business Times reports.
In 2004, Blue Cross of California's parent company, WellPoint, merged with Anthem. The following year, PacifiCare Health Systems merged with United Healthcare.
Frank Kase, former president of the California Podiatric Medical Association, said that United/PacifiCare cut physician reimbursements by 20% to 30% after its merger. He added that WellPoint/Blue Cross also reduced its rates.
In July, a survey by the California Medical Association found that 20% of the more than 1,500 physicians surveyed in 31 counties had terminated a Blue Cross contract, or planned to, after the insurer cut its payment rates.
Cheryl Randolph, spokesperson for United/PacifiCare, said the contracting and claims-related disputes with physicians are not "a systemic issue" but added that the insurer was "addressing [the issues] aggressively."
Nick Garcia, a Northern California spokesperson for WellPoint/Blue Cross, said, "Less than 1% of the 53,000 providers in our Prudent Buyer PPO network have terminated their contracts, and every day we receive new applications" from providers to join the network.
Insurers defend the mergers, but state regulators have investigated certain disputes and in some cases have issued fines and other actions.
For example, Blue Cross was fined $1 million by the Department of Managed Health Care earlier this year for its policies governing the cancellation of individual health care coverage.
Meanwhile, a DMHC spokesperson said a report could be issued as early as November on a state investigation of delays, underpayments and other physician contract errors by United/PacifiCare (Rauber, San Francisco Business Times, 10/19).