Major Legislation Enacted Calling for Fairness in Managed Care Contracts

Dear NCMS Members:

On Wednesday, July 10, Senate Bill 877 “Health Plan Provider Contracts / Transparency” was passed by the NC General Assembly to address some of the unfair business practices of health plans in contracting with physicians. This landmark legislation, sponsored by Senator Dan Clodfelter (D, Mecklenburg), prevents insurers from unilaterally making fee schedule changes to physician contracts. The bill also permits a physician to identify a person in the practice to receive all proposed contract amendments to help ensure that the proposed changes are understood and are given the proper attention.

The approval of S877 by the NC General Assembly is the culmination of an ambitious project that began more than 18 months ago as a joint endeavor of the NCMS and NC Medical Group Managers (NCMGM). The legislative phase of the project was particularly challenging, and would not have been successful without the support and involvement of Senator Clodfelter and a team of health interest groups including the NC Society of Anesthesiologists, the NC Academy of Family Physicians, the NC Radiology Society and the NC Hospital Association. Your NCMS has advocated for this legislation aggressively — with extensive physician grassroots involvement. This is a major step toward fair negotiation of contracts with health plans.

It is the hope of your Society leadership that this legislation sends a message loud and clear to managed care organizations that policy makers expect physicians to be treated fairly by insurance companies. In the remaining days of the 2009 session, we believe the managed care organizations will continue their efforts to unravel the progress made by passage of S877. The NCMS will not cease in its efforts to preserve the advances of S877 and ensure that medical practices are treated fairly and equitably in contract negotiations.

As President of the NCMS, I am proud of these outstanding efforts and want to emphasize to my colleagues that the NCMS plays a unique and central role in advocacy efforts for our patients and for all physicians. I appreciate your continued support of the NCMS and outstanding efforts such as this.

Albert J. Osbahr
President, North Carolina Medical Society


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