Insurer Agrees to Pay Doctors $198 Million - 07/12/05

Deal Hailed as Victory Over Managed Care

Article from the Washington Post Online

WellPoint Inc., the nation's largest health insurer with nearly 29 million members, announced yesterday a $198 million settlement with physicians and medical societies designed to reduce the number of disputes over what care is medically necessary and alleged unfair reductions in payments to doctors.

The agreement, the largest of its kind, will mean a modest back payment to about 700,000 doctors and, more important, significant changes in the way the managed-care company pays medical claims in the future. Physicians hailed the settlement as one of the first real victories in their decades-long struggle with managed-care companies over who decides what tests, therapies and surgeries a patient receives.

"The insurance company will no longer be in the exam room with the physician and patient," said Michael Sexton, president of the California Medical Association. "The patient will get the appropriate care they need, when they need it."

Industry analysts predicted WellPoint will increase premiums to cover some of the cost, valued at more than $450 million over several years, including lawyers' fees, payments to doctors and the cost of new billing systems. But WellPoint spokesman James Kappel said the firm may be able to hold down premiums through modernizing and other efficiencies.
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