California MDs say health plan mergers bad for business

A few years ago, California physicians predicted that the mergers hooking up PacifiCare Health Systems with United Healthcare and WellPoint Health Networks/Blue Cross of California with Anthem Inc. would put the squeeze on their practices. That's a fear shared by the AMA, which has long lobbied to block large U.S. health plan mergers or restrict the terms under which mergers could take place, arguing that such consolidation could lead to antitrust violations.

Now, rank-and-file California physicians arguing that their fears were on the mark. While the evidence is scattered and anecdotal, physicians and groups cite fee cuts of as much as 20 to 30 percent by United/PacifiCare, and substantial cuts by WellPoint/Blue Cross as well.  Fees are now proving low enough to prompt defections from the health plans' networks, according to a California Medical Association survey of 500 state medical practices, which found that 20 percent of 1,500 affiliated physicians had terminated a Blue Cross contract or planned to do so.

Spurred by such concerns, the California Medical Association has been involved in several tussles with state health plans in recent times. For example, in August the CMA asked the state to cite Blue Cross for questionable business practices, allegedly including refusals to pay for pre-authorized care, retroactive policy rescissions and steep reimbursement cuts despite rising premiums.

To learn more about these issues:
- read this San Francisco Business Times piece

Related Articles:
PA health plan merger would create giant. Report
AMA cites antitrust activity among insurers. Report
NY legislators study health plan mergers. Report

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