Blues News; August 2004

Public Health Authority gets underway
The Aug. 18 inaugural meeting of the Detroit Wayne County Health Authority capped an 18-month odyssey of planning and politics and began a coordinated effort to address the growing health care crisis in Detroit and Wayne County.

"The ball has been handed to the Detroit Wayne County Health Authority to be the model in the nation for how we can coordinate and provide care," said Gov. Jennifer Granholm at the first public meeting at the Cabrini Clinic in the Detroit’s Corktown neighborhood.

"This cooperation in health care is unprecedented," said Gail Warden, former CEO of Henry Ford Health System and the person who helped guide the health authority as it formed. "This is the first time I've felt all the players were talking to each other with the same goal in mind."

The health authority originated with a joint task force Granholm established in April 2003 to prevent two Detroit hospitals from closing. The task force's recommendations resulted in a $50-million public bailout for Detroit Receiving Hospital and Hutzel Women's Hospital. But city and state officials, along with local health care leaders recognized the fix was just a stopgap measure. Structural reform was deemed necessary.

A separate group was formed to investigate long-term solutions to the crisis. The governor, mayor of Detroit and Wayne County executive entered into an agreement establishing the health authority in December. After much internal wrangling, the Wayne County Commission and Detroit City Council approved the agreement, setting the stage for the authority’s launch.

The authority will be financed by a $500,000 federal grant and $600,000 from foundations and charitable organizations during its first year of operations.

Doctors want voice in coverage decisions
By MICHAEL SANDLER, MD
Chair, MSMS Board of Directors
The Aug. 1 newspaper story, "Blue Cross cuts 1,350 doctors in network," is just the tip of the iceberg about how poorly Blue Cross Blue Shield of Michigan is treating its participating physicians and our patients.

Ironically, Blue Cross Blue Shield recently held three "summit meetings" to seek a better relationship with physicians, while making unilateral contracting decisions that infuriate physicians and could disrupt patient care.

Two recent examples highlight the disrespectful nature of Blue Cross's unfair business practices.
In early July, Blue Cross sent recontracting letters to physicians in Blues Preferred Plus giving them a matter of days to reply or be disaffiliated. The reimbursement schedule was not even included. As the story noted, it also plans to cut up to 10 percent of the physicians in this plan, forcing thousands of patients to find a new medical home.

What other business could behave in such an arbitrary and capricious manner to the people on whom they depend for their very existence?

Ford, DaimlerChrysler and GM's recent United Auto Workers settlement also is disheartening. Autoworkers were taken from the traditional plan and put into a preferred provider organization, a false label since none of the autos have contracted with any physicians.

Blue Cross and the autos also misuse the term "covered service" by saying it includes office visits, even though they are subject to 100 percent co-payment. What else in the future might be called a "covered service" that UAW members will pay out of their own pockets?

If physicians do not comply with the unilaterally discounted office visit fee, it's clear they will be disaffiliated from UAW plans, as well as other Blue Cross PPO plans, further disrupting patient care. Even if physicians agree to this reduced reimbursement, the autos and Blue Cross intend to cut many doctors from the UAW networks next year anyway, so UAW members' freedom to choose their own physicians will become further limited.

The goal of the Michigan State Medical Society is to provide high-quality care to our patients. We understand controlling health care costs is important. We simply want an equal voice in how it is done.

1010 Antietam Road, Detroit 1958-2004
The longtime headquarters of the Wayne County Medical Society was sold to the Detroit Entrepreneurship Institute, Inc., on July 29, 2004. The building at 1010 Antietam Road was the only headquarters building known to many members. In 1958, when the Society moved from the Whitney House to Antietam Road, the new WSU School of Medicine was across the mall in Shapiro Hall and a number of hospitals were within walking distance. Over the years changes occurred, the hospitals are now in close proximity to one other within the DMC, the WSU School of Medicine is housed in Scott Hall on Canfield St. and the Society is a suite of offices at New Center One on West Grand Blvd.

The Detroit Entrepreneurship Institute, Inc., established in 1990, is a non-profit licensed proprietary school and has provided business training, technical assistance and start-up capital for 14 years.
Our best wishes to the DEI for years of success.

Members in the News
Krishna Sawhney, MD, was named President of the American Medical Association Foundation for 2004-2005. Dr. Sawhney is on the staff of Henry Ford Wyandotte Hospital  and serves as Chief of Surgery, Downriver Region, for the Henry Ford Health System in Detroit. He also is a Clinical Associate Professor of Surgery at Wayne State University School of Medicine.

Sophie Womack, MD, Sinai-Grace Hospital’s (SGH) Chief of Neonatology, has been named the new President of the Detroit Medical Center Medical (DMC) Staff. Dr. Womack will oversee all matters related to the physicians and allied health professionals within the DMC.

EDITORIAL: Being Blue Or Being Preferred
By JOSEPH WEISS, MD
Editor
I am referring to the announcement you have already heard: BCBS intends to drop a good number of physicians from its Blue Preferred Plus (BPP) network. The number originally was 700 primary care physicians, though newspaper articles set the goal as 1,350 doctors. (In the local 21 counties there are 8,000 physicians in the network with the number of primary care physician representing one-half to two-thirds of the total).

According to BCBS the criteria they will use has four aspects: (1) cost/patient, (2) prescription costs, (3) patient satisfaction scores, and (4) measures of quality based on HEDIS (Health Plan Employer Data and Information Set). BCBS states that it has the data on hand on each physician in the Blue Preferred Plus network to profile each physician and on the basis of points, decide who among doctors will continue to be preferred, and which doctors will be dropped from the network.
What reason is there to drop any doctor? The Blues reply that they are the messengers, the message came from the auto companies. Each of the big three - Ford, GM, DaimlerChrysler - eventually came to an agreement that the Blue Preferred Network should downsize to include only the most efficient "providers."

While the Blues state there are four criteria for inclusion, the feeling in the medical community is that by far the greatest weight will go to criterion of the physician's cost/patient. If that physician is high, he or she will be out, and if low, will continue in the network.

Neither the Big Three nor BCBS offer a rationale explaining why fewer doctors would mean less cost. To date, no analysis exists as to how many high-cost doctors are in BPP, how much higher their cost is compared with the average, or what price BPP pays by shifting an increased patient load to the doctors who remain in the network. No one has thought out if the tradeoff is worthwhile if doctors are overworked, and patients are underserved.

The Michigan State Medical Society has responded as follows:
-Asked for the weight BCBS will give to each of its four criteria.
-Requested a written appeal process available to doctors who wish to dispute BCBS conclusions or actions on participation.
-Continues to gather its own data to respond to BCBS's claim that the elimination of 700-1350 physicians will mean no loss for autoworkers in terms of access to care, its timeliness, or personal quality.

As if dropping physicians and doing so with no prior warning by either contract or letter wasn't bad enough, the new contract tells doctors to do more work and guarantees them in return less remuneration.

More woe to primary care physicians: more criticism, more scrutiny, and now welcome to the world of day labor.








CORRECTION
An error appeared in the editorial in our June 2004 newsletter. Dr. Weiss stated that "Rep. Howell will be opposed by Dr. Roger Kahn, a Genesee cardiologist." Dr. Kahn is a cardiologist in Saginaw County. In addition, he will not be running against Rep. Howell, who is not running for state representative.

The Rising Tide Of Health Care Costs Doesn’t Raise All Boats
By GEORGE SHADE, MD
Chief, Department of Obstetrics and Gynecology
Sinai-Grace Hospital-Detroit Medical Center
This is the first time I have heard a balanced perspective on this whole health care issue. The Big Three are responsible for capitulating to the UAW for years offering the "Rolls Royce" of health care benefits to its hourly employees. The cost of everything is going up!

In striking contrast, however, the percent of the health care dollar that goes to physicians for direct patient care has continued to go down. I think doctors have been squeezed to their limit from all sides: insurances, government, and professional benevolence in the form of pro bono service.
Hospitals are closing or cutting back on staff and services, doctors are leaving the City of Detroit, Wayne County, the State of Michigan or just choosing to revamp their life and how they practice medicine. I saw a dermatologist patient of mine recently who says that she no longer accepts any kind of insurance as payment for her professional services. She is tired of the litany of paperwork, onerous regulatory requirements from the government, and ever-rising overhead expenses.
Just by eliminating insurance headaches, she has been able to reduce her office staff and overhead expenses by 60 percent with little or no impact on her gross receipts.

The industry leaders need to direct their frustration where it should be focused: on pharmaceuticals, laboratory services and durable medical supplies.

It is absurd when the cost of a single prescription is sometimes three times the cost of the doctor's visit. One is paid significantly more to run a lab test than to take direct care of a sick patient. The issue of durable medical supplies, where vendors are becoming millionaires supplying oxygen, bedpans, walkers or other items at rental rates that are sometimes greater than four times the cost of buying the product outright, is almost as ridiculous as what the military pays for its supplies.
Everyone one who is lower on the food chain is actually feeding better than the primary sources of health care in America.

MSMS scrutinizes
new UAW/PPO provisions
By JESSY SIELSKI
Chief of Communications, MSMS
In the June 2004 edition of The Record, Blue Cross Blue Shield of Michigan released details of the General Motors/Delphi UAW PPO benefit structure. DaimlerChrysler implemented their version of a new UAW PPO, called the "Standard Care Network," on April 1, 2004. The GM version of the new PPO, titled "Traditional Care Network," was implemented July 1, 2004, and has subtle but important differences from the DaimlerChrysler UAW PPO. Ford is now anticipated to implement their version on Sept. 1, 2004. All of these PPOs were implemented to enroll those auto company employees currently covered under the auto companies' traditional insurance programs. BCBSM has committed those physicians who have entered into a Blue Preferred Plan (Trust) Professional Provider Agreement (the "Trust Network Physicians") with BCBSM ("PPA") to provide office visit services to the PPO enrollees for new fee schedule amounts.

Like DaimlerChrysler, General Motors expects that Trust Network Physicians will bill the PPO enrollees new fee schedule amounts that are less than what Trust Network Physicians have been charging for these office-visit services. Although Trust Network Physicians are allowed to bill the patient at the time of the visit, General Motors also expects Trust Network Physicians to submit a claim to BCBSM so that it can generate a voucher and an explanation of benefits that will confirm the member's financial responsibility. Since it is unlikely that there will be a condition under which the member will not be responsible (the DaimlerChrysler UAW PPO has a $5,000 annual deductible applicable to office visits and the GM UAW PPO has a 100 percent co-payment requirement for office visits), the need for this paperwork is not apparent.

MSMS legal counsel reviewed the Physician Participation Agreement and is seeking answers and information from BCBSM and/or auto company representatives prior to giving a formal opinion as to whether Trust Network Physicians are obligated to bill only the fee schedule amount for office visit services. Trust Network Physicians are not obligated to accept a fee schedule rate for office visit services without a contract obligating them to do so. BCBSM seems to be relying on the PPA as this contract. However, an examination of the PPA raises several questions/issues:
-The Trust contract references certificates, riders and/or benefit plan descriptions issued by BCBSM. These would outline covered services and specify the obligations of the Trust Network Physicians. BCBSM staff has stated that there are no certificates or riders because this is an administrative service contract.  How can physicians be obligated to rules that are not specified in the manner referred to in the contract? How can BCBSM exert what is virtually an "all products clause" by obligating physicians to accept all PPO products if they want to participate in the Trust network?
-If the contract obligates physicians to accept the Trust fee schedule for covered services, how can services that have 100 percent patient co-pay or an unreasonably high deductible be considered covered services?
-With few exceptions, fee schedule changes cannot be implemented until after 60 days written notice. Very broad details on the DaimlerChrysler and Ford PPOs were published in the January 2004 edition of The Record, but MSMS had to make inquiries in March to find out what office visits were included and to get written verification of the catastrophic deductible before the April 1, 2004, implementation date. GM PPO program details were not released until the June 2004 edition of The Record, and the program was implemented July 1, 2004. Why was appropriate notice not given?
-The Trust contract states that physicians should only seek payment for covered services from BCBSM. How does this reconcile with the instruction that physicians collect office visit fees directly from patients?
MSMS notified members about concerns with this program through a Payer Solutions Network e-mail message on June 24 and will provide updates on a regular basis. MSMS is also educating legislators about the concerns they may be hearing from physicians in their districts. For more information, contact Julie Novak at MSMS at (517) 336-5768 or jnovak@msms.org.

Doctors’ suit against Blues continues, judge says
A federal judge has rejected Blue Cross Blue Shield of Michigan's request to dismiss a class action lawsuit by several Oakland County doctors over reimbursement practices at the state's largest health insurer, reported the Associated Press.

US District Judge Bernard A. Friedman ruled that portions of the case should remain in federal court while one portion dealing with timely reimbursement should be dealt with through other channels, such as the state insurance commissioner., according to the report.

The doctors’ assert that the Blues intentionally delayed payment for services rendered.
Blue Cross officials said they were pleased with the ruling on prompt payment, while attorneys for the doctors say they were glad that a charge that Blue Cross violated the federal Racketeer Influenced and Corrupt Organizations Art remained, reported the AP.

``This lawsuit is misdirected and without merit and we are pleased that the court has already dismissed one of its counts,'' Blue Cross spokeswoman Helen Stojic told The Daily Oakland Press of Pontiac.

Linda Watson of the Troy law firm of Cox, Hodgman and Giarmarco that represents the doctors told the AP that Blue Cross violated federal statutes when in 2002 it changed billing codes for gynecological services.

She said Blue Cross then routinely denied payment on legitimate claims on the false grounds that the codes submitted by physicians were incorrect.

Dr. Susan Adelman and her art
I would like to bring to the attention of the membership, that Dr. Susan Adelman's latest work is now on display at the Charach Gallery, at the Jewish Center (Drake Road, just north of Maple Road) and will be there through Sept. 29. She will also have a show at the Southfield Public Library (Civic Center Drive near Telegraph) that opens Thursday, Sept. 2 from 6-8 p.m. DMN readers are invited to the opening.

We know Dr. Adelman as a pediatric surgeon who also wielded an incisive and witty pen. However her talent ranges in art to painting, sculpture and jewelry design. The two showings exhibit the range of her skills and reveal that her incisive mind and eye retain their vigor.

I have seen the Charach Gallery show and was impressed with her range of subjects and the statements she makes on the people and scenes she paints. As always, it continues to be worth your while to pay attention to what Susan does, her work and artistry can enrich each of us.
— Joe Weiss, MD

Blue Preferred Plus reduces network, MSMS seeks appeal process for physicians
By JESSY SIELSKI
Chief of Communications, MSMS
Blue Cross Blue Shield of Michigan is revising the payment arrangement for the Blue Preferred Plus (BPP) program, a smaller auto PPO network established in 1994. Previously, physicians contracting with BPP were paid at the TRUST fee schedule with a 15 percent withhold. The withhold return was determined by the cost of the plan versus patients enrolled in the Traditional program. The autos specified that BPP had to be less costly than Traditional for the withhold to be returned, so it was based on aggregate measures, not individual performance. Because sicker patients were attracted to the program for the more generous office visit coverage, and because the autos froze the program size and did not let new patients enroll, BPP inevitably became more expensive, and the withhold was not returned for the last several years.

BCBSM now is revising the program at the request of the auto companies. The payment will now be 10 percent under the TRUST fee schedule, with no withhold. They are also reducing the size of the network by eliminating 700 primary care physicians this year. New contracting letters are being sent to physicians over the next several weeks. The 700 that will not be invited to rejoin the network represent a 5 percent reduction of the network and were chosen based on profiles conducted by Blue Care Network, which does some of the administrative work for the network. The measures used included economic profiles, quality data (HEDIS performance), pharmacy prescribing patterns, and patient satisfaction.  MSMS is asking that BCBSM address the need for an appeal mechanism for physicians that are dropped from the network. BCBSM intends to address reduction in the number of specialists when they have better data to measure them by, possibly in 2005.

For more information, contact Julie Novak at MSMS at (517) 336-5768 or jnovak@msms.org.

MSMS Board takes action on automaker PPO issue
A series of strategies to address concerns raised by the new United Auto Workers PPO contracts with the Big Three automakers was approved by the MSMS Board of Directors during its July 25 meeting.

The collective bargaining negotiations last fall resulted in moving all UAW members previously covered under the Traditional Plans to so-called "PPOs" created by each of the auto companies that are administered by BCBSM. Instead of creating a real PPO by contracting with physicians, hospitals and others necessary to provide the covered services the auto companies have represented to their employees that the BCBSM TRUST Network is required to provide services at the TRUST fee screen rates.

MSMS Legal Counsel specifically asked BCBSM if charging other than the TRUST fee screen would be a breach of the TRUST Network Agreement.

BCBSM wrongly believes that the TRUST Network Agreement obligates physicians to charge the fee screen amount rather than the amounts historically charged for office visit services. This interpretation of the TRUST Network Agreement by the auto companies and BCBSM is based on their erroneous conclusions that an office visit is a "covered service" even though it requires a 100 percent patient copayment (or a deductible that has been set so high, e.g. $5,000, that it will never be met) and that the benefit plan descriptions issued by the auto companies have somehow been "sponsored" by BCBSM.

MSMS Legal Counsel also specifically asked what would be the consequences of such a "breach" of the TRUST Network Agreement.

BCBSM officials have been clear that physicians who do not comply with the office visit discounts will be disaffiliated from the TRUST network after an "educational" phase.
After a thorough review of the TRUST contract and discussion with BCBSM officials, MSMS Legal Counsel does not believe that the TRUST contract requires physicians to charge only the fee screen amount for office visit services provided to enrollees in these "PPOs."

The TRUST Network Agreement only requires physicians to charge the fee screen amount for covered services provided to patients (i.e. services that are actually covered) that are cited in a certificate, a rider or benefit plan description issued by BCBSM or under its sponsorship. This would only include patients enrolled in a BCBSM PPO plan. BCBSM has said that in order to stay in the TRUST Network, physicians must participate in all programs offered by BCBSM, including these new "PPOs" (which are really just self-funded employer plans and not PPOs). In other words, if physicians do not accept this unilaterally imposed fee reduction, they will become an "out-of-network" provider for any patient enrolled in a BCBSM PPO product.

"Based on action taken by the MSMS Board of Directors, MSMS is currently pursuing every possible avenue to reach a resolution with BCBSM about this onerous provision in the UAW PPO rules," said MSMS Board Chair Michael A. Sandler, MD. "MSMS Legal Counsel has been instructed to explore all possible legal remedies if a resolution cannot be reached. MSMS also is educating legislators about the impacts of this violation of generally accepted business practices, including possible disruption of patient care."

What can you do? MSMS has developed a sample letter to help physicians explain this situation to their UAW patients. This letter can be downloaded from the MSMS Web page at http://www.msms.org/bsyp/news/LettertoPatients.doc and printed on your office stationary.
You also can go to the MSMS Action Center to send messages to Blue Cross officials or contact your legislator. The Web address for the action center is: http://capwiz.com/msms/issues/alert/?alertid=6215766&type=CU&azip=48823&bzip=2605. To reach your legislator, use: http://capwiz.com/msms/mail/oneclick_compose/?alertid=6214336.

BCBSM expects to have 3 million (or 75 percent of its covered lives) enrolled in its PPOs by the end of 2004. In addition, the patients who see an out-of-network physician are sanctioned with fines and increased copays and deductibles. DaimlerChrysler and General Motors have already implemented the new PPO structures; Ford will begin implementation on Sept. 1, 2004.
For more information, contact Julie Novak, MSMS Director of Medical Economics, at (517) 336-5768 or jnovak@msms.org.

Blues policy changes bring more questions than answers
From Dr. Federico Mariona:
Following the efforts of MSMS the deadline for "new" provider contract return to the Blues was extended to Aug. 31. That said, time is running short to activate further steps to protect the involved physicians.

First, we don’t know to this day who the disinvited are. Are they those who do not receive the new blank contract to sign? Who has the list ? We really dont't know for certain how many are not going to be "invited back" into the new product. The numbers given by the blues are confusing. Are those 1,200 or so part of the total number of participating physicians in the state or part of the participating Primary Care Physicians?

If the latter is the case as I believe it is, the impact on practices and hospitals may be variable according to the distribution of subscribers per affected physician and the number of PCPs per hospital in any area. Some practices and hospitals, especially in Southeast Michigan may have a major impact if their volume is large and patients are required to change PCP AND hospital at the same time.

Further, whatever (Blues Medical Director) Simmer has said is also suspect since it is Blue Care Network that administers the program, therefore it is probably in the hands of Kevin Seitz.
I am probably not up-to-date in the activities and new strategies of MSMS, however, I believe that once Aug. 31 is gone those disinvited physicians will be out of the loop with no recourse other than some request for "reconsideration" or activating the "appeal" process, which we all know how long it takes and what the possible results will be.

I am rhetorically asking: Are MSMS and the regional societies ready to strongly support physicians in this new attempt by the monopolizing insurer to restict their professional activities ? We know which language those insurers understand the best. Your thoughts and updates will be appreciated.

MSMS Response:
Yes, MSMS is continuing to pursue this issue vigorously. I am including questions that we sent to Blue Cross, and we were promised answers shortly. Please know that MSMS legal counsel has read the existing and new BPP contracts, and has advised us that no one can be dropped from the network until they have received a separate letter giving them 60 days notice. We intend to make sure that they live by the rules of the existing contract on this issue. We have already insisted they set up an appeal mechanism, so that those that are targeted for disaffiliation can examine the data that are being used and pursue a reconsideration.

Here are the questions we sent, putting BCBSM and BCN administrators on alert that we expect these issues to be resolved quickly. We have asked that the list of physicians being targeted for disaffiliation be released to us and to physician organizations. Our legal counsel will have additional analysis and recommendation when we receive their response, or if we do not get complete answers.

1)  Please confirm for me the next steps in this process and the exact timelines for what will occur next.
2)  The date for returning the contract was extended to :Aug. 31 after MSMS expressed concerns. What will happen to physicians that do not return the contract by that date?
3)  When exactly will you be mailing letters to the 700 PCPs you plan to disaffiliate from the BPP network? When can I see a draft of the letter that is going out? Our understanding is that the old contract requires you to give 60 days notice in that letter.
4)  You and I spoke several times about the need for an appeal process for physicians that you are disaffiliating. Please tell me what that appeal process will be, and confirm that it will be outlined in the letter that will go out to physicians.
5)  We have heard from group practices that have only received contracts for some physicians in the group. This obviously would create coverage problems if a patient needs to be seen when the contracted physician isn't available. How do you intend to address this?
6) Some of the large PO groups are struggling to understand who is in and who is out, particularly since you have yet to notify the 700 you plan to drop. When you notify the 700, we would like to have a copy of the list and ask that you provide PO groups names of physicians in their area that are being dropped. We are wasting a lot of your and our time talking to people that weren't in BPP before, because they are confused about whether this issue applies to them. This could have been avoided if people receiving contracts had been given appropriate notice and had timely access to fee schedule information. Instead we had to fax and e-mail everyone so that they knew the deadline had been extended. If your relationship with the autos doesn't allow fair notification and complete information for physicians before they must make a contracting decision, then it will be hard to sell the wonders of the Provider Affiliation Strategy to our members.
7) I have had calls from several practices that contacted the phone numbers included in the letter (BCN Provider Affairs), and have either not gotten return calls or can't seem to get the information they want. We have been referring our members to Provider Consulting, since this is a Blue Cross PPO product and we expect that PCS staff will follow up with physicians or refer them to the right people.