Issued and entered March 31, 2003 by Frances K. Wallace, Chief Deputy Commissioner

ORDER

I
PROCEDURAL BACKGROUND

On February 10, 2003, XXXXXXXXXXX (“Petitioner”) filed a request for external review with the Commissioner of Financial and Insurance Services under the Patient’s 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 18, 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 27, 2003.

II
FACTUAL BACKGROUND

On XXXXXXXXXX, the Petitioner underwent a breast biopsy at XXXXXXXXXXXXXX in XXXXXXXXX. XXXXXXXXX XXXXXXXXXXXXXX, P.C. (XXXX) provided the anesthesia services. XXXX does not participate with BCBSM. The anesthesia charge was $952.07. BCBSM approved and paid its maximum payment amount of $301.00 for this care. XXXX made an adjustment of $476.07. This left a balance for the Petitioner of $175.00.

III
ISSUE

Is BCBSM required to pay an additional amount for the anesthesia services?

IV
ANALYSIS

Petitioner’s Position

The Petitioner’s surgeon referred her toXXXXX. There is no other anesthesiologist at XXXXXXX Hospital. There also is no BCBSM-participating anesthesiologist in theXXXXXXXXXX area. The Petitioner argues that she did not sign any document agreeing to pay the balance of her anesthesia services. Therefore, she believes that BCBSM is required to pay the $175.00 balance for this care.

Commissioner’s Review

Petitioner has coverage under the Community Blue Group Benefit Certificate. The rider, Reimbursement Arrangement for Professional Services (“RAPS”) also applies.

Under the Certificate, participating doctors agree to accept BCBSM’s 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 selects 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 which 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.

The certificate of coverage defines the term “Non-participating Provider” 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 “approved amount” and that a non-participant is not bound to accept it as payment in full.

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 provider… [Emphasis added]

The highlighted portion above is a 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, BCBSM submitted evidence that participating anesthesiologists are located within a reasonable distance from Petitioner’s home.

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 participate.

A patient would understandably be upset to learn the anesthesiologist is billing for the balance over the BCBSM approved amount. One must remember though, 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 perform. 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.

The Certificate clearly stated that non-participating providers are not bound to accept the approved amount and may charge more. The excess charges are Petitioner’s responsibility; she is therefore responsible for the $175.00 balance.

V
ORDER

The Commissioner upholds the final adverse determination in this case. BCBSM is not required to pay an additional amount for Petitioner’s XXXXXXXXXXXXXXXX, 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, MI 48909-7720.