PAMED Meets with Highmark, Pushes Insurer to Reconsider Decision on Physician Reimbursement Cuts

The Pennsylvania Medical Society (PAMED) held its second meeting with Highmark senior staff on March 8, 2016, and asked the insurance giant to reverse the 4.5 percent reimbursement cut to private practice physicians who see patients under the Affordable Care Act (ACA).

Highmark lost an estimated $500 million on marketplace plans in 2015. As a result, Highmark sent a letter to PAMED saying it would remedy the loss with a 4.5 percent cut in reimbursement to physicians who treat patients on ACA plans.

PAMED immediately responded to Highmark’s announcement by asking the insurer to reconsider the decision. PAMED also sent a letter to the Pennsylvania Insurance Department to demand it explore the facts behind Highmark’s decision.

“I’m very disappointed to learn that private practices in Pennsylvania would be strapped with the burden of correcting Highmark’s budgeting errors,” said PAMED President Scott Shapiro, MD, FACC, FCPP. “Many physicians are justifiably angry about this.”

“Highmark aggressively priced its individual market products in 2014 and 2015 in what appears to be a misguided attempt to gain market share beyond their capabilities,” Dr. Shapiro continued. “They now compound this problem with further poor management decisions by penalizing the most efficient and cost effective sector of our health care system.”

Highmark isn’t cutting payments to hospitals. When asked why not by the Harrisburg Patriot-News, a Highmark official said there is “precedent” for such adjustments with physician practices, while cutting hospital reimbursements would require hospital-by-hospital negotiations.

“That Highmark has a ‘precedent’ of doing this on the backs of physicians is something that needs to be addressed immediately,” Dr. Shapiro said. “We would like Highmark to understand the value that physicians bring and not just have them view physicians as a tool to balance the budget.”

Dr. Shapiro reports that after the first meeting with the Highmark administration last week, he was pleased that Highmark acknowledged mistakes made in the way this situation was handled. The subsequent meeting on March 8 led to a promise for continued discussion of how to prevent such cuts in the future but Highmark has still not pledged to restore the planned cuts to physicians this year.

PAMED will continue talks with Highmark and will update its members on any progress made. Dr. Shapiro said he hopes that next week’s meeting with Highmark officials in Harrisburg becomes a meaningful discussion that improves relationships with physicians.