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Physician Joint Negotiations With Insurers Protect Patient Interests

March 7, 2002

(Washington, DC): The Health Care Antitrust Improvement Act of 2002, introduced in the House of Representatives today, will begin to level the playing field between managed care organizations (MCOs) and physicians during contract negotiation. The Act allows physicians to engage in joint negotiations with health plans, according to the American College of Physicians - American Society of Internal Medicine (ACP-ASIM).

"Under current law, physicians are not allowed to collectively negotiate fee structures with health plans," said William J. Hall, MD, FACP, president of the ACP-ASIM. "This puts individual physicians and their patients are at a distinct disadvantage when trying to negotiate with a large managed care plan."

Current laws apply a "rule of reason" to joint negotiations by physicians with health plans over contractual terms and plan policies. This means that the courts simply determine whether a group engaged in joint negotiations promotes or suppresses competition. The proposed legislation would allow courts to consider not only the issue of competition, but also the effect of the joint negotiations on patient access to care and quality of care.

"Negotiations currently consist of a health plan presenting a contract to a physician and saying, often literally, 'take it or leave it'," said Dr Hall. "Ultimately, the managed care plans are responsible to their stockholders and physicians must be able to stand up to managed care companies to protect their patients' best interest."

The College has offered support for the pilot projects contained in the legislation. The Act requires six demonstration projects, each in a different state, that would allow two or more physicians to engage in negotiations with a health plan.

"The demonstration projects included in the Act will allow health plans and physicians to determine what impact these types of negotiation have, before the law is rolled out," said Dr. Hall. "This thoughtful approach should lead to a working model that protects the interest of all involved."

The Act also reduced penalties against physician negotiating groups that are challenged by MCOs. Physician groups could not be required to pay attorneys fees for challenges by the MCO, unless their behavior is in bad faith, unreasonable or frivolous. MCOs would no longer be able to recoup treble damages, if the physicians meet certain conditions laid out by the Attorney General.

ACP-ASIM is the nation's largest medical specialty society and the second largest professional medical association. The College represents over 115,000 physicians who specialize in internal medicine and medical students with an interest in internal medicine.


Jack Pope, ACP-ASIM Washington Office, (202) 261-4556

Page updated: 11-04-03

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