A CMA analysis of Blue Cross’s Prudent Buyer contract has found that it is inconsistent with state laws and regulations, including the Knox-Keene Act. The detailed analysis of the contract and its flaws is available to members at the members-only website. You can also find on the website objective written analyses of a dozen other major health plan contracts on the website.
The contract, among other things, gives Blue Cross the authority to unilaterally decrease contracted payment rates if a physician refers patients to out-of-network providers. This provision not only improperly obstructs the physician-patient relationship and interferes with PPO patients’ right to access out-of-network benefits, but is also a violation of California law, which requires insurers to give contracted physicians 45 days' notice of material changes to their contracts and an opportunity to terminate the contract if the new terms are not acceptable. Additionally, this provision is inconsistent with the RICO settlement, in which Blue Cross agreed to give 90 days’ notice of any material contract change.
CMA reminds physicians that before they sign a health plan contract, it is important to know what value that relationship will bring to their practice. Physicians do not have to accept contracts that are not mutually beneficial.
To help physicians negotiate and manage complex third-party payor agreements, CMA has published a contracting tool kit, “Taking Charge: Steps to Evaluating Relationships and Preparing for Negotiations—A Focus on Payor Contracting.” The tool kit is available free to members at the members-only website. Nonmembers can purchase the tool kit for $100 in the CMA bookstore.
