Agreement protects physicians in Michigan Blues network

While a lawsuit brought by organized medicine continues, any termination of a doctor who refuses to accept lower fees from a UAW contract will be judicially reviewed for cause.

By Robert Kazel — Posted Feb. 28, 2005

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Blue Cross Blue Shield of Michigan has pledged not to terminate physicians from a PPO network serving some 2 million patients if the physicians reject reimbursement fees recently imposed by the insurer as part of new contracts with the Big Three automakers.

The largest insurer in the state agreed in Ingham County Circuit Court in February that as long as a court fight with the Michigan State Medical Society and the Michigan Osteopathic Assn. is unresolved, it will refrain from taking retaliatory action against doctors who do not accept the PPO fees.

The fees are approximately 25% to 40% lower than what physicians were receiving under self-insured plans the United Auto Workers had previously negotiated with Ford, General Motors and DaimlerChrysler, said Julie Novak, director of medical economics for MSMS.

The medical societies filed suit in September 2004, challenging the discounted fees established by Blue Cross for UAW insurance contracts with the three auto manufacturers. That original case, supported by the AMA, is still pending.

The societies asked a judge Jan. 11 to protect physicians who won't honor the revised fee discounts. They are arguing the fee changes are invalid and not binding on Blues doctors, in part because they were imposed unilaterally, and in part because the Blues plan is an administrator, not a sponsor, of the UAW contract.

Under the agreement signed by the Blues plan, the medical societies and Judge Joyce Draganchuk, if a physician charges patients more than the new PPO rates for office visits and is later removed by the plan from the network, the judge will individually review the case to see if the termination was out of retribution.

About 18,000 physicians are part of the network.

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