Physicians say PPO network's fax masked 25% pay cut

Organized medicine criticizes a W-9 request by Three Rivers Provider Network that also authorized lower reimbursement.

By Jonathan G. Bethely — Posted June 4, 2007

Print  |   Email  |   Respond  |   Reprints  |   Like Facebook  |   Share Twitter  |   Tweet Linkedin

The AMA and several state medical societies are engaged in ongoing discussions with a PPO network that sent a fax to physicians that appeared to be a routine request for tax information -- but also bound physicians to having their reimbursement cut by 25%.

San Diego-based Three Rivers Provider Network sent the fax to physicians who had treated member patients, but who were not part of any TRPN network. TRPN not only has direct contracts with physicians, but also rents networks from other PPOs -- a practice which organized medicine has criticized as a "silent PPO" because physicians never negotiate rates with a plan, yet find themselves in it because they have signed a deal with a PPO that has rented out its network to someone else.

The TRPN fax noted that IRS regulations require that it "maintain a current taxpayer identification number on file for all providers of services," and provided a fax number to which physicians could return the form.

However, the TRPN fax also contained a paragraph stating that physicians would agree "payment of services will be 75% of provider's total billed charges for covered services." Physicians would sign one form; there was no opportunity to opt out of or negotiate the cut.

It's not uncommon for Howard H. Rosenblum, MD, an ophthalmologist in Nashville, Tenn., to receive a random fax from an insurance company asking him to fill out a W-9, so when Dr. Rosenblum received the TRPN form, he said he signed the document without much hesitation. Several months later, while conducting a spot check of his claims receipts, Dr. Rosenblum noticed he wasn't getting his normal fee from the insurance companies with which he contracts.

"It was hard to figure out why I was taking a discount when I had no known discount with them," Dr. Rosenblum said. "Finally, [an insurer] told me I needed to check with Three Rivers."

In a May 1 letter to TRPN, AMA Executive Vice President and CEO Michael D. Maves, MD, MBA, urged TRPN to revise its practices. "Whether it is the intent of TRPN or not, the perception of physicians is that TRPN is seeking to trick physicians into signing a contract by disguising this document," Dr. Maves wrote.

For instance, Dr. Maves said the document should be identified as a "Participating Provider Agreement" to sufficiently prompt physicians that it is in fact a contract. In addition, the contract should reflect standards that establish mutual benefits and obligations associated with a contract.

Todd Breeden, TRPN's chief operating officer, said the company has stopped sending the original document after receiving the AMA letter. In a May 3 letter to the AMA, Breeden wrote "there is no intent on our part to confuse any health care provider." Breeden said he has sent the AMA a revised copy of the document TRPN faxed.

"We thought that the [original] document was clear," Breeden said. "We still do think it's clear. However, we want to work with everyone. We're going to work with the AMA and the other state medical associations to make sure that there is no one out there that isn't able to understand it."

Unlike the previous fax, the new document carries a title, written in all capital letters: "THIS IS A PROVIDER AGREEMENT WITH THREE RIVERS PROVIDER NETWORK AUTHORIZING DIRECT PAYMENTS FROM THE PAYOR." A few paragraphs are rearranged, but the language of the document is essentially similar to the old fax.

AMA Board of Trustees member J. James Rohack, MD, a cardiologist from Temple, Texas, said he has seen the revised document from TRPN and says while it is an improvement, it doesn't go far enough.

"In an attempt to control health care costs, the insurers and the employers are looking at anything they can to drive down their financial responsibility," Dr. Rohack said. "Clearly these repricers are a way to have physicians sign contracts to discount their services without the doctor knowing what benefit they are going to get."

Meanwhile, Matthew Katz, executive director of the Connecticut State Medical Society, said his organization has filed a complaint with the Connecticut Attorney General's Office, which has also been in contact with TRPN.

Back to top



Read story

Confronting bias against obese patients

Medical educators are starting to raise awareness about how weight-related stigma can impair patient-physician communication and the treatment of obesity. Read story

Read story


American Medical News is ceasing publication after 55 years of serving physicians by keeping them informed of their rapidly changing profession. Read story

Read story

Policing medical practice employees after work

Doctors can try to regulate staff actions outside the office, but they must watch what they try to stamp out and how they do it. Read story

Read story

Diabetes prevention: Set on a course for lifestyle change

The YMCA's evidence-based program is helping prediabetic patients eat right, get active and lose weight. Read story

Read story

Medicaid's muddled preventive care picture

The health system reform law promises no-cost coverage of a lengthy list of screenings and other prevention services, but some beneficiaries still might miss out. Read story

Read story

How to get tax breaks for your medical practice

Federal, state and local governments offer doctors incentives because practices are recognized as economic engines. But physicians must know how and where to find them. Read story

Read story

Advance pay ACOs: A down payment on Medicare's future

Accountable care organizations that pay doctors up-front bring practice improvements, but it's unclear yet if program actuaries will see a return on investment. Read story

Read story

Physician liability: Your team, your legal risk

When health care team members drop the ball, it's often doctors who end up in court. How can physicians improve such care and avoid risks? Read story

  • Stay informed
  • Twitter
  • Facebook
  • RSS
  • LinkedIn