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Baltimore, MD (February 19, 2010) — CareFirst BlueCross BlueShield (CareFirst) is strongly urging Maryland consumers, businesses, labor unions and local governments to oppose two bills (SB 314 / HB 147) now being considered by the Maryland General Assembly. As proposed, the legislation could burden Marylanders with hundreds of millions of dollars in new health care costs at a time when many already are struggling to afford health care coverage.

The bills would require health insurers to pay members' claims directly to non-participating physicians for the care they provide the insurer's members, known as "assignment of benefits." Such out-of-network physicians then can "balance bill" patients for any portion of their charges not covered by the patient's insurance. Since physician fees are unregulated, physicians could seek unlimited fees from patients in addition to the benefit paid by the insurer.

"These bills are bad policy, bad cost control and really bad for consumers," said Chet Burrell, CareFirst President and Chief Executive Officer. "They would give physicians carte blanche to charge and collect exorbitant fees from our members. Because no one regulates physician charges, these charges are often many times the amount of the fees we negotiate with our participating physicians."

Burrell added, "If these bills pass, individual consumers may increasingly have to pay out of their own pockets the additional charges of non-participating physicians. If even 10 percent of our participating doctors drop from our provider networks, we project that our members in Maryland could face $220 million in new out-of-pocket charges."

Guaranteed direct payment from insurers (as well as increased patient volume) is among the primary reasons physicians join a health insurer's networks. If physicians receive the benefit of direct payment without joining a network, and then can collect unlimited additional charges from patients, the incentive to join a network disappears.

"By negotiating fair and reasonable rates with network physicians, CareFirst and other health insurers help to hold down costs for their members," added Burrell. "It is unconscionable in this environment to propose a measure that will not only undermine an existing tool for managing health care costs, but will result in hundreds of millions of dollars in new costs that will be borne directly by Maryland consumers and businesses."

In its 73rd year of service, CareFirst, an independent licensee of the Blue Cross and Blue Shield Association, is a not-for-profit health care company which, through its affiliates and subsidiaries, offers a comprehensive portfolio of health insurance products and administrative services to nearly 3.4 million individuals and groups in Maryland, the District of Columbia and Northern Virginia. Through its CareFirst Commitment initiative and other public mission activities, CareFirst supports efforts to increase the accessibility, affordability, safety and quality of health care throughout its market areas.

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