Psychiatric News February 6, 2004
Volume 39 Number 3
© 2004 American Psychiatric Association
p. 4
Medical Society Charges Blues With Unfair Reimbursement Practices
Christine Lehmann
Blue Cross/Blue Shield of North Carolina was sued by the state medical society on charges that it engaged in deceptive and unfair business practices that harmed physician income.
The courts will decide whether Blue Cross/Blue Shield of North Carolina (BCBSNC) has shortchanged physicians in a new lawsuit filed by the North Carolina Medical Society last month.
"BCBSNC has engaged in numerous unfair and deceptive acts and practices designed to delay, deny, impede, and reduce lawful reimbursement to NCMS physicians who are participating in its networks," according to a summary of the complaint, which was filed in Wake County Superior Court.
For example, BCBSNC uses software programs that "automatically downcode procedures and/or deny payment to physicians without appropriate clinical review, oversight, or justification," according to the complaint.
The medical society also complained that physicians can no longer "obtain a coverage decision from BCBSNC prior to rendering a service" because the insurer ended its predetermination program.
In addition, the insurer "failed to provide adequate staffing, staff training, or staff supervision to handle physician inquiries."
Similar charges were brought by 15 medical societies in a national lawsuit against several large health care insurers including Anthem Blue Cross/Blue Shield (see article above). Although both the state and national lawsuits are seeking significant changes to the insurers’ business practices, NCMS isn’t seeking financial relief for its members.
NCMS had met with BCBSNC and other managed care organizations for several years to discuss these and other concerns identified by NCMS physician members, said society president Lawrence Cutchin, M.D., in a statement.
The talks broke down last year after NCMS refused to sign a confidentiality agreement that BCBSNC requested to protect its position in another national lawsuit. BCBSNC and 64 other Blue Cross affiliates and the national BC/BS Association are defendants in a lawsuit filed by physicians last August in the Southern District Court of Florida, according to the statement.
NCMS has retained the New York law firm Milberg Weiss, which "successfully represented us in the settlement talks with Aetna US Healthcare and Cigna Healthcare," said Cutchin in the statement. The two companies settled for $470 million and $540 million, respectively, last year.
Information about the lawsuit is posted on the NCMS Web site at www.ncmedsoc.org/ under "News Highlights" and "North Carolina Medical Society Files Lawsuit Against Blue Cross." 
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