Paying the physician's fee: Blue Shield and the reasonable charge.

Area of Science:

• Health Policy
• Medical Economics
• Public Health

Background:

• Physician fees and income are subjects of ongoing debate.
• Blue Shield plans and programs have evolved to determine physician payment structures.
• Medicare's "reasonable-charge" formulas influenced Blue Shield's "usual, customary, and reasonable" (UCR) payment models.

Purpose of the Study:

• To describe the evolution of Blue Shield physician payment systems.
• To analyze the impact of UCR protocols on physician fees.
• To examine the role of physicians in controlling fee-setting committees and boards.

Main Methods:

• Review of Blue Shield's historical fee-payment protocols.
• Analysis of fee adjustments for surgical procedures in the Washington, DC area over a three-year period.
• Examination of board composition and committee majorities for Blue Shield plans nationally.

Main Results:

• Blue Shield UCR protocols allowed for substantial increases in allowances for selected surgical procedures (29-75%) within three years.
• Specific examples show significant fee hikes for procedures like coronary-artery bypass.
• Physicians dominate Blue Shield boards and fee-setting committees, controlling payment formulas.

Conclusions:

• There is limited justification for the secrecy surrounding physician fee-payment protocols.
• Physician control over Blue Shield boards and committees influences fee determination.
• Increased public debate, representation, and accountability are crucial for monitoring and reforming these programs.