Blue Cross Withdrawal

Dear Blue Cross Patients,

Please read below for details of our withdrawal from Blue Cross. Please understand that if you are covered by Independence Blue Cross, Pennsylvania Blue Cross or Keystone of Pennsylvania, this decision DOES NOT AFFECT YOU since your care is billed through our contract with Amerihealth, the Pennsylvania Blue Cross subsidiary in New Jersey. For you, we will remain in-network and you will not incur any additional cost to continue to see us.

We have created this page to provide you with more details of our withdrawal from the remaining Blue Cross Plans. For many years, we have participated with New Jersey Blue Cross Blue Shield, now called Horizon Blue Cross. Visits for patients covered by all Blue Cross plans, including out of state plans, were billed to Horizon Blue Cross of New Jersey, and paid by them at their fee schedule, which had been reduced by them during our years with the University of Pennsylvania Health System. Penn never told us that this occurred. When we separated from Penn, we discovered that the Blue Cross fees were slightly below Medicare for our most common services.

Because this fee schedule was not acceptable, and represented a discount of approximately one third from what the other insurance companies in the state were paying us, we tried for six months to meet with Blue Cross. We were finally successful, meeting with their representatives on March 12, 2002. When we explained that their fees were too low, they handed us a letter, dated January 2002, which we had never seen before. This letter stated that, as of February 15, 2002, they would change their fee schedule, resulting in an increase in their fees by an average of 2%. They said they would get back to us on our request for a more meaninful increase. Unfortunately, neither of these things has happened.

To date, we have not only not received any response to our request for increased fees, and not seen the promised 2% increase, but they have lowered the fees by as much as 33% without prior notice to us. They did this for dates of service beginning about four weeks before the date they gave us the letter. We never received any notification by mail or any other means and we were not informed prior to the implementation of these reduced fees, as is required by all insurance contracts we have signed.

The fees they now pay for the services we provide range from more than 10% to more than 35% below Medicare and are in some cases less than half of what other insurers pay us for the same service. Horizon will pay us 37% to 40% less than their competition for a routine office visit for a cold or a blood pressure check. They pay 50% to 55% less for a complete physical. For a complete physical they pay less than $5 more than our other insurers pay for a routine office visit.

Had Blue Cross just refused to increase the fees, we might have remained with them. Unfortunately, they did not do this. We have looked carefully over the fees they have been paying for the past two months. The reality is that we can not continue to provide first class care for the amounts we are now receiving. This drastic reduction in fees leaves us no choice but to terminate our contract with them beginning May 15, 2002.

In an effort to reduce the inconvenience to you, our patients, we will withdraw in stages. Immediately we are closed to new Blue Cross patients. Any new patient insured by Blue Cross who wishes to see us will be charged our standard fee. We will, if Blue Cross allows, submit the claims electronically on your behalf to expedite your reimbursement, but we will not be bound by the Blue Cross fee schedule and will expect payment of our full charge from the patient. This also applies to any existing patients who change to Blue Cross on or after May 15, 2002.

For existing Blue Cross patients, we will remain in network until the end of the calendar year, but we will not accept their lowered fees. If you wish to see us, we will bill you for the difference between the fees in effect before this reduction and the amount now paid by Blue Cross, plus any copays or coinsurance due. This will result in an increase in your costs of approximately $5 for an office visit and $45-50 for a physical. This will allow us to continue to provide proper care until our final withdrawal at the end of the calendar year.

We take this action with great reluctance, but feel that it has been forced on us by the unilateral actions of New Jersey Blue Cross. Please inform your company HR office, or your union or welfare fund, of these actions by Blue Cross. If you are not currently offered other insurance options, please ask your representative to consider providing other insurance for your next plan year.

We apologize for the inconvenience which this will cause; we hope you understand that this was not the path we hoped we would be following.

If you have questions, please feel free to call us, or email us your questions or comments at email@HightstownMedical.com. Please be sure to supply your name and email or phone number if your would like us to respond.

Sincerely,
Hightstown Medical Associates