From the Miami Herald last week comes news that the Blues have agreed to settle class action claims brought by 900,000 physicians for wrongful denials and slow payments. Beyond payment of $128 million, additional terms of the settlement are not spelled out in detail in the article but apparently they include the agreement by the Blues to “implement ‘important and valuable business practice changes,’ streamlining claims communications between insurers and doctors.” Color me unimpressed. Let’s first look at how the amount the Blues affiliates will pay under the settlement breaks down. $128 million sounds like a lot of money. And it is. But spread out among the physicians and the Blues insureds, it is a drop in the bucket. The amount the Blues agrees to pay breaks down to $142 per doctor. When you break down the amount paid as it is spread out over the number of Blues insureds across the country covered by the settlement, it is approximately $1.88. This just isn’t a lot of money when you figure in the number of doctors and patients the settlement sweeps up. So it is pretty clear that any real value to the settlement isn’t in the amount paid out, it's in the prospect that there will be a substantive change in the way the Blues affiliates carry out their business in the future. I’d be happy to revise my initial assessment if it turns out that there is real bite to these “business practice changes” referred to in the article. But it sounds like language some PR folks came up with to cover up the fact that the Blues make some pleasant sounding but non-substantive commitments to do a better job in their claims denial communications and payment procedures. Insurers will not fork over money any sooner than is absolutely necessary. Without specific, tangible time frames within which payment on clean claims must be made and monetary consequences for payments that fall outside those time frames, life will go on for the Blues and their insureds and physicians pretty much the same as it always has. Likewise, without aggressive monitoring and economic consequences associated with the failure of insurers to send out more specific and understandable EOBs, the promise of “valuable business practice changes” will be illusory. I’m going to try to get more information on the substance behind the language in the Miami Herald article. But right now I’m underwhelmed by this deal.
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