||Blue Cross and Blue Shield of Michigan
Issued and entered March 11, 2003 by Frances K. Wallace, Chief Deputy
On February 6, 2003, XXXXXXXXXX (Petitioner) filed a request for external
review with the Commissioner of Financial and Insurance Services (Commissioner)
under the Patientís Right to Independent Review Act (PRIRA) MCL 550.1901
et seq. After a review of the material submitted, the Commissioner accepted
the request on February 13, 2003.
The issue involved in the adverse determination is contractual. The
Commissioner reviews contractual issues pursuant to MCL 550.1911(7). As
a result, review by an independent review organization is not required.
The Commissioner notified Blue Cross and Blue Shield of Michigan (BCBSM)
of this filing and requested the information it used in making its adverse
determination. The Office of Financial and Insurance Services received
the BCBSM information on February 25, 2003.
On XXXXXXXX, the Petitioner had back surgery at XXXXXXXXXXXXXXXXXX. The
hospital and surgeon participate with BCBSM. However, the anesthesiologist
did not participate with BCBSM. The anesthesia charge was $1,224.00. BCBSM
approved and paid its maximum payment amount of $861.77 for this care,
but it left Petitioner with a balance of $362.23.
Is Blue Cross and Blue Shield of Michigan (BCBSM) required to pay an
additional amount for the anesthesia services?
The Petitioner chose an in-network hospital as well as an in-network physician.
She met the anesthesiologist just before she went to the operating room.
She thought the anesthesiologist was a participating provider, like the
surgeon and hospital. She believed the anesthesiologist services would
be covered in the same manner as the surgeonís fees. Had she known the
anesthesia services were not covered at 100% she would have considered
other alternatives. She therefore believes BCBSM should pay the full amount
charged for her anesthesia services.
Petitioner has coverage under the Community Blue Group Benefit Certificate.
Rider RAPS (Reimbursement Arrangement for Professional Services) also
Under the Certificate, participating doctors agree to accept BCBSMís
approved amount as payment in full for a covered service. A participating
doctor cannot charge the patient the remaining balance even if the BCBSM
payment is lower than the amount the doctor normally charges. If the member
obtains services from a non-participating doctor, BCBSM will pay the same
approved amount it pays to a participating doctor. The non-participating
doctor, however, is not bound to accept the BCBSM amount as payment in
full. The doctor therefore may balance-bill the patient.
BCBSM determines the payment level for each service by applying a Resource
Based Relative Value Scale (RBRVS). RBRVS reflects the resources required
to perform each service. It includes physician time, specialty training,
malpractice premiums, practice expenses and overhead. BCBSM regularly
reviews the payment level to address the effects of changing technology,
training, and medical practice. BCBSM claims the $861.77 it paid for the
XXXXXXXXXX, anesthesia care is equal to the maximum amount payable under
its system of payment for the procedure performed.
BCBSM claims that participating anesthesiology providers were available
to provide the Petitionerís care. BCBSM found five anesthesiologists near
the Petitioner residence. Two of these providers were within fifty miles
of her home. Therefore, she was not limited to the non-participating provider
that her primary physician recommended.
The Certificate of Coverage controls the analysis in this matter. It
defines the term ďNon-participating ProviderĒ as:
Any provider who has not signed a participation agreement with BCBSM
to accept the approved amount as payment in full. However, nonparticipating
providers may agree to accept the approved amount on a per claim basis.
This language places a subscriber on notice that BCBSM pays an ďapproved
amountĒ and that a non-participant is not bound to accept it as payment
Moreover, Section 2 of the RAPS Rider informs a member that he or she
may be affected when a non-participating provider is used. It states:
When you receive services from a non-participating provider, you should
expect to pay charges to a non-participating provider at the time you
receive the care. It is then your responsibility to submit a claim to
us. If we approve the claim, we will send the payment directly to you.
Because non-participating providers may charge more than our
approved amount, our payment to you may be less than the amount
charged by the providerÖ [Emphasis added]
The highlighted portion above is a clear warning that using a non-participating
provider may lead to a reimbursement lower than the charged amount. This
provision may be invalid if no participating providers were available
within a reasonable distance. However, participating anesthesiologists
are located within a reasonable distance from Petitionerís home.
The Commissioner finds the Certificate is clear in its discussion of
non-participating providers. The Certificate is available for the member
to read. If a certificate is not available, the member may contact BCBSM
for coverage details. It is therefore Petitionerís responsibility to determine
whether a provider participates with BCBSM.
The analysis so far has focused on the BCBSM Certificate. One could
say the contractual review is too strict and fails to account for the
realities facing patients anticipating surgery. One such reality is that
a patient is rarely (if ever) given information about the anesthesiologist.
The anesthesiologist is of course affiliated with the hospital (a BCBSM
participating facility); and patients typically assume the anesthesiologist
also participates with BCBSM. A majority of the time the assumption is
true, but it is possible the anesthesiologist does not participate with
BCBSM.Unfortunately, in the case at hand the anesthesiologist does not
A patient would understandably be upset to learn the anesthesiologist
is billing him for the balance over the BCBSM approved amount.
One must remember BCBSM only pays the medical expenses. It seeks to
contract with various medical professionals to uphold its contractual
duties. It does not control the doctors and the procedures they choose.
As a result, BCBSM has practically no role in determining if a particular
physician provides services to the subscriber. Its contract places the
burden of choice on the subscriber. The patient therefore cannot reasonably
blame BCBSM for not informing him/her whether an anesthesiologist participates,
unless of course the patient specifically asks BCBSM prior to the surgery.
In the case at hand, the anesthesiologist is a non-participating provider
with BCBSM. He is not bound to accept the BCBSM approved amount and is
free to charge a reasonable and competitive amount.
Although the Commissioner empathizes with the Petitioner, it is clear
that (as between Petitioner and BCBSM) the Petitioner is responsible for
the balance of the anesthesiologist charges. The Commissioner finds the
$861.77 paid by BCBSM for the XXXXXXXXXX, anesthesiology services is equal
to or greater than the maximum allowable under its system of payments.
The Commissioner upholds the BCBSM final adverse determination. BCBSM
is not required to pay an additional amount for Petitionerís XXXXXXXXXXX,
anesthesiology services. This is a final decision of an administrative
agency. Under MCL 550.1915, any person aggrieved by this order may seek
judicial review no later than sixty days from the date of this order in
the circuit court for the county where the covered person resides or in
the Circuit Court of Ingham County. A copy of the petition for judicial
review should be sent to the Commissioner of the Office of Financial and
Insurance Services, Health Plans Division, Post Office Box 30220, Lansing,