Comparing insurance plans

New York - Doctors should periodically review the parameters of all the insurance plans to which they belong to see if any are not keeping step with the others.

Robert A. Skidmore, M.D., of Gainesville, Fla., says many physicians need to be more familiar with their third party payor contracts to be able to judge which plans are best for their practice.

At the recent American Academy of Dermatology (AAD) Academy '04 here, Dr. Skidmore outlined a system that will assist doctors in obtaining the information they need to make wise choices among the insurance companies vying for their membership.

"Doctors should list the plans they belong to across the top of a sheet of paper; then, down the side, list a number of points to compare." Dr. Skidmore says the first three factors doctors should consider involve the way insurance companies treat key modifiers.

"First, there is the multiple procedure rule - a rule telling dermatologists how they will be paid if they perform more than one procedure at a time.

"Second, there should be a box to check that indicates whether or not an insurance company has what is called a -25 modifier. That permits physicians to be paid for the evaluation and management of a condition like psoriasis at the same time they perform a procedure.

"Third, there is the -59 modifier which is used when the physician performs more than one procedure at the same time. Doctors need to use this modifier to alert the insurance company they are not performing multiple procedures on a single lesion," says Dr. Skidmore.

It isn't that doctors should automatically drop companies that don't have these provisions in their contracts, but Dr. Skidmore notes that these are important factors for dermatologists to consider.

The 'three lists of 20' The next items Dr. Skidmore recommends are the "three lists of 20."

Listing all of these factors on the matrix enables the physician to easily review the contracts and search for what Dr. Skidmore calls an "outlier" - an insurance company that is just not paying at the same level for similar services.

Evaluating an 'outlier' "Once an 'outlier' is identified, take a look and see what percentage of the practice's revenue comes from that insurance company.

"If the 'outlier' represents 50 percent of the practice's revenue, I doubt doctors will want to cancel their participation. However, if the plan represents less than 5 percent of the practice's revenue, doctors may consider ending their participation in the 'outlier' plan," says Dr. Skidmore.

Other than dropping the plan, Dr. Skidmore says dermatologists can contact the company and inform them that the physician reviewed the contract and found it wanting.

The physician should attempt to re-negotiate the fee schedule to a level comparable to other plans.

"If the physician presents a clear and compelling case," Dr. Skidmore says, "many insurance companies may be willing to increase their fees."

Assessing new plans Dr. Skidmore notes that dermatologists should go through the exact same process if they are considering a new insurance plan, along with asking a couple more questions.

"Request information from the company on how many people are covered by the plan in the area, so the doctor can estimate the number of potential patients the plan represents," says Dr. Skidmore.