PHYSICIAN GROUP’S DEMAND FOR HIGHER REIMBURSEMENTS WOULD RESULT IN HIGHER INSURANCE COSTS FOR BLUE CROSS AND BLUE SHIELD OF TEXAS CUSTOMERS
More Than 40,000 Blue Cross Members in Lubbock County would be Forced to Pay Higher Costs for Health Care.
July 11, 2007, Richardson, Texas — Blue Cross and Blue Shield of Texas (BCBSTX) members in Lubbock and surrounding areas would have to cope with higher insurance premiums and higher health care costs if the health coverage provider yielded to recent requests from Covenant Medical Group (CMG) to significantly increase reimbursement to its physicians. Covenant’s request would lead to a 7.5% to 8.5% increase in insurance premiums as well as increased costs for employer groups and members, especially self-insured employers in Lubbock County.
Despite several attempts by Blue Cross to continue productive discussions with the medical group, Covenant has announced its intent to terminate all PPO and HMO contracts involving Blue Cross and Blue Shield of Texas members, effective in mid-September, unless the health coverage provider agrees to increase reimbursements to their group.
“During discussions over the past several weeks, Blue Cross has kept the lines of communication open in an attempt to reach an agreement that would not significantly increase costs for members,” says Darren Rodgers, senior vice president, Health Care Management, Blue Cross and Blue Shield of Texas. “Our goal is to achieve a reasonable balance that will allow us to fulfill our responsibility to members to hold-the-line on medical cost increases and maintain equity among physicians in the same area and specialty. We are disappointed that we have not been able to find common ground with Covenant.”
The Covenant Medical Group, which consists of approximately 110 non-hospital-based physicians, has been asked to accept reimbursement levels comparable to other physicians participating in Blue Cross PPO and HMO networks practicing the same specialties in Lubbock and surrounding counties. However, Covenant wants to be reimbursed at higher levels than other network physicians who practice the same specialties in Lubbock County and the surrounding area. In fact, the standard fee schedules in Lubbock are higher than the standard fee schedules in several major metropolitan areas in Texas.
“Regardless of what the medical group decides, we will make access to care for Blue Cross members our number one priority,” says Rodgers, “allowing Blue Cross to focus on protecting lower costs. The medical group’s decision will not affect our BlueChoice members’ access to any of the other 450 physicians in our BlueChoice network, 96% of whom are accepting new patients.”
Should CMG hold to their decision to terminate their contracts, Blue Cross members who have questions about benefits or their doctors’ participation in their network, may contact the Blue Cross and Blue Shield of Texas Customer Service Department by calling the customer service number on the back of their ID cards. A customer service advocate will be happy to provide complete information about options for obtaining care in the area. The Covenant Medical Group has not terminated its PAR agreement, which, if possible, Blue Cross plans to maintain in order to restrict balance billing and contain costs.
Blue Cross and Blue Shield of Texas – the only statewide, non-investor owned health insurer in Texas – is the largest provider of health benefits in the state, working with nearly 40,000 physicians and 400 hospitals to serve 3.5 million members in all 254 counties. Blue Cross and Blue Shield of Texas is a division of Health Care Service Corporation (HCSC), the country’s largest non-investor owned health insurer and fourth largest health insurer overall. HCSC is a Mutual Legal Reserve Company and an Independent Licensee of the Blue Cross and Blue Shield Association.
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