American Medical News reported yesterday that Blue Cross Blue Shield of North Carolina has agreed to give up its demand that its participating physician providers accept an amendment to their existing provider agreements that would have potentially allowed BCBS to unilaterally change reimbursement rates.

The North Carolina Medical Society along with the NC Medical Group Managers and two other physician groups had written a letter to Insurance Commissioner Wayne Goodman on October 26 asking that his department intervene in the matter. The physicians argued that the proposed amendment was an attempt to circumvent a law enacted earlier this year designed to promote fair dealing between payors and providers. The Bill, North Carolina Senate Bill 877, will go into effect on January 1, 2010. It will require payors to notify providers at least 60 days in advance of any changes to their agreements. If the providers object to the changes, then the payor would be able to terminate the agreement upon 60 days notice.

BCBS has denied that the proposed amendment was an attempt to circumvent or alter the new law.

This is the most recent chapter in the ongoing conflict between healthcare providers and healthcare payors.  Providers have long criticized the perceived overwhelming bargaining power that payors have over them. Recently payors have been more aggressively pursuing ways to reduce reimbursement rates. Most notably, we’ve seen this in the area of out of network reimbursement, but in-network rates have also been under pressure.

You can find a copy of the letter sent by the North Carolina Medical Society here.

You can find a copy of Senate Bill 877 here.

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