Issued and entered March 27, 2003 by Frances K. Wallace, Chief Deputy Commissioner

ORDER

I
PROCEDURAL BACKGROUND

On October 20, 2002, XXXXXXXXXXXXXXX (Petitioner) filed a request for external review with the Commissioner of the Office of Financial and Insurance Services (Commissioner) under the Patient’s Right to Independent Review Act, MCL 550.1901 et seq. After an assessment of the material submitted, the Commissioner accepted the request.

Petitioner’s case required a determination on medical issues, so the Commissioner assigned the case to Permedion, an independent review organization (IRO). The IRO provided the opinion and recommendation of a medical expert. The IRO completed its review on November 1, 2002, and sent it to the Office of Financial and Insurance Services (OFIS).

II
FACTUAL BACKGROUND

Petitioner is a Blue Cross Blue Shield of Michigan (BCBSM) member. She seeks additional reimbursement for an upper gastrointestinal endoscopy she underwent with a doctor who does not participate with BCBSM. The charge for the procedure was $673.00, but BCBSM only reimbursed Petitioner $217.67 (BCBSM’s $241.85 approved amount, less a $24.18 copayment). Petitioner does not believe she should have to pay the $455.33 balance. She exhausted BCBSM’s internal grievance procedures, and BCBSM issued a final adverse determination in her case on September 16, 2002.

III
ISSUE

Did BCBSM properly deny Petitioner additional reimbursement for the upper gastrointestinal endoscopy performed by a non-participating doctor?

IV
ANALYSIS

PETITIONER’S ARGUMENT

Petitioner believes BCBSM should provide her with coverage that leaves her with no more liability in this case than if she had gone to a participating doctor. She asserts that because the amount BCBSM paid for her upper gastrointestinal endoscopy is hundreds of dollars short of the actual charge, it serves to penalize her for going to a non-participating doctor. Petitioner argues that it was not appropriate for BCBSM to penalize her, because she did not know the doctor she went to was a non-participating provider until after she obtained the service at issue. She therefore argues the Commissioner should reverse BCBSM’s final adverse determination in her case.

BCBSM’S ARGUMENT

In its August 9, 2002, final adverse determination letter to Petitioner, BCBSM stated:

We previously issued the maximum benefit available for the services in question. No additional payment can be made.

To clarify, [Petitioner’s] coverage includes the Rider RAPS (Reimbursement Arrangement for Professional Services). As indicated in the [Rider RAPS], our payments for physicians’ services are based on a comparison of the lower of the charges billed and our maximum payment level. The lower of the two is the approved amount. We will pay the approved amount for each medically necessary covered service, less any deductibles and/or copays that may be required by the amended certificate and related riders.

In this instance, [the] charges of $673.00 exceeded our maximum payment level of $241.85. Thus, our approved amount is $241.85 (the lower of the two). However, [the doctor] does not participate with us. This means he will not accept our approved amount as full reimbursement for services rendered and he can bill you for the difference. …

BCBSM therefore argues the Commissioner should uphold its final adverse determination in this matter.

IRO’S RECOMMENDATION

The medical expert who reviewed this case is certified by the American Board of Internal Medicine, with a Subspecialty Certificate in Gastroenterology, and is in active practice. The medical expert recommended upholding BCBSM’s final adverse determination in this case. The IRO noted the following observations and conclusions:

• Petitioner could have obtained her upper gastrointestinal endoscopy from a BCBSM participating provider, as the procedure did not require any special skills above those of a normal gastroenterologist.
• It appears from the documentation that BCBSM and Petitioner submitted to the IRO that Petitioner made no attempt to find out whether or not the provider who performed her upper gastrointestinal endoscopy participated with BCSBM.

COMMISSIONER’S REVIEW

The Commissioner carefully reviewed the arguments and documents the parties submitted, as well as the findings of the IRO medical expert. The focus of this analysis is whether BCBSM properly denied Petitioner benefits in excess of its approved amount for an upper gastrointestinal endoscopy, according to the Community Blue Group Benefits Certificate. This Certificate controls her health coverage. The Rider RAPS amends the Certificate and contains the following language:

Section 2: Payment Arrangement for Professional Provider Services

[BCBSM] will pay the approved amount for each medically necessary covered service, less any deductibles and/or copayments that may be required…

• Non-participating Provider

Because non-participating providers may charge more than the approved amount, [BCBSM’s] payment…may sometimes be less than the amount charged by the provider.

The Rider RAPS also gives the following definitions:

Approved Amount
The lower of the billed charge or [BCBSM’s] maximum payment level for the covered service.

Non-participating Provider
Any provider who has not signed an agreement with [BCBSN] to accept [BCBSM’s] payment for covered services as payment in full. …

In the section entitled “How Physician And Other Professional Provider Services Are Paid,” the Community Blue Group Benefits Certificate explains:

If the…provider is nonparticipating, you will need to pay most of charges yourself. Your bill could be substantial.

After paying the provider, you should submit a claim to [BCBSM]. If [BCBSM] approve[s] the claim, [it] will send payment to you.

NOTE: Because nonparticipating providers often charge more than our maximum payment level, [BCBSM’s] payment to you may be less than the amount charged by the provider.

These provisions clearly put Certificate holders on notice that if they obtain services from non-participating providers, they may incur personal financial liability for balances that BCBSM’s maximum payment levels do not cover. The Community Blue Group Benefits Certificate does not guarantee that BCBSM will pay for covered services in full. According to the Rider RAPS, BCBSM pays for the lesser of either the charge for a covered service or BCBSM’s maximum payment level for the covered service. There is no difference in the maximum payment level BCBSM applies to services from participating or non-participating providers.

When a member goes to a non-participating provider, that doctor is under no obligation to accept BCBSM’s approved amount as payment in full and may bill the member for any remaining balance. However, when a BCBSM member goes to a participating provider, the physician has a contract with BCBSM to accept BCBSM’s approved amount as payment in full. The member incurs little or no personal financial liability. If BCBSM members wish to guarantee that their benefits will pay for a covered service in full, they must go to a participating provider. If they do not go to a participating provider, they are responsible for any balance that their BCBSM benefits do not cover.

In the case at hand, Petitioner obtained a service from a non-participating provider, and BCBSM paid its maximum payment level for that service, less a copayment. This completely complies with the terms of Petitioner’s coverage in the Community Blue Group Benefits Certificate. It is unfortunate that this left her with a significant balance for which she is now responsible, but the Certificate clearly notifies members of the financial risks they can expose themselves to by going to non-participating providers. Petitioner could have avoided nearly all financial liability in this matter, simply by seeking out and obtaining the service from a participating doctor. Given plain language of both the Certificate and the Rider RAPS, Petitioner should have known to ascertain the participation status of any doctor before obtaining the services. The Commissioner therefore finds that BCBSM properly applied its maximum payment level to the provider charges. Accordingly, the Commissioner finds that BCBSM’s final adverse determination in this matter is valid.

V
ORDER

The Commissioner upholds BCBSM’s September 16, 2002, final adverse determination in Petitioner’s case. BCBSM does not owe Petitioner any further payment for the upper gastrointestinal endoscopy performed by a non-participating doctor.

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.