2 eye-care groups leave Blue Cross

Minnesotans who have grown accustomed to seeing any doctor they like may be heading into an era of more limited choice.

At least two independent medical specialty groups are leaving the network of Minnesota's biggest health insurer because they can't agree on new reimbursement rates.

Minnesota Eye Consultants, the biggest independent eye specialty practice in the state, and Associated Eye Care in the east metro said Monday they are terminating their contracts with Blue Cross and Blue Shield of Minnesota because the insurer cut payment rates by 10 percent last summer. The contracts expire in December. After that, Blue Cross members will have to pay more out-of-pocket to see physicians at those centers.

The terminations come after a similar standoff between Blue Cross and Fairview Health Services last summer. That was resolved a day before the contract expired, and it's still possible that the eye specialists and Blue Cross will settle their differences by December.

While a niche player, Minnesota Eye treated 30,000 Blue Cross members in the past three years.

Minnesota Eye's president, Candace Simerson, said the issue was about consumer choice. "This is a threat to independent practices and it's going to force them to consolidate," Simerson said. "Soon there's not going to be any choices, there's going to be one or two large systems."

Blue Cross said hundreds of eye specialists remain in its network. The rate adjustments were part of an annual exercise for all medical specialties, said Jim Eppel, vice president of network management.

Pricing pushback

Blue Cross, Minnesota's biggest insurer with 2.9 million members, appears to be toughening its stance in a battle to hold down premiums, said Dave Delahanty, a consultant with Watson Wyatt in Minneapolis. Earlier this year, Blue Cross broke briefly with Grand Itasca Clinic and Hospital in Grand Rapids, Minn., after contract talks failed. Grand Itasca was reinstated in Blue Cross' network in the spring.

Delahanty said he expects self-insured employers to push back with Blue Cross to keep Minnesota Eye in its network, as they did with Fairview.

But he said the development fits a trend toward narrowing networks and tiering providers by price. The 1990s backlash against limited choice led to today's broad networks. Now the pendulum may be swinging back.

What's more, "physicians are willing now to just say no," said David Glaser, an attorney with Frederikson and Byron, whose clients are independent physician practices. "I do suspect it's part of an evolving trend." Glaser represents Minnesota Eye but wasn't involved in the Blue Cross negotiations.

Reimann said negotiations with other insurers all resulted in new contracts this year.

David Miller, executive director at Associated Eye Care, which has five east metro locations, said that the group asked for a rate increase of between 2 1/2 and 3 1/2 percent.

But "there was one offer and one offer only, and it was a 10 percent cut," Miller said.

The practice has 95,000 patients, of whom 12,828 are Blue Cross members.

Consumer response

Minnesota Eye itself is considering the same thing. As it turns out, Blue Cross administers the company's self-insured plan for 215 employees and dependents.

"We've definitely made the decision to shop it," Simerson said.