The maximum fees paid to doctors by the Washington ares's most widerly-used insurance plan have increased between 29 percent 75 percent for six common surgical procedures over a three-year period, according to a Congressional staff report.
According to the study of Blue Shield fees based on information obtained under subpoena, the maximum charge for a tonsillectony went from $175 in 1975 to $250 in 1978 - a 43 percent increase. The charge for a coronary artery bypass operation, now the most commonly performed heart operation in the United States, went from a maximum fee of $2,000 in 1975 to $3,500 in 1978 - a 75 percent increase.
THe maximum fees paid for four commonly-performed laboratory procedures increased by 20percent to 25 percent in the same three-year period, according to the study. A complete blood count, a standard procedure, went from a maximum fee of $8 to $10 from 1975 to 1978, a 25 percent increase. A pap smear, another standard procedure for woman, went from $10 to $12 - a 20 percent increase over three years.
The increase in fees, coupled with increased use of services, has led inevitably to a rise in the premiums charged by Blue Shield ti its subscribers.A Blue Shield spokesman confirmed yesterday that premiums had gone up over the three-years period studied, but was unable to give a precise statement of those increases.
With 1.3 million subscribers in the Washington area. Blue Shield is far and away the largest single insurer of physician's bills. Blue Shield is far away the largest single insurer of physician's bills. Blue Cross, closely associated with Blue Sheild, insures its subscribers against the cost of hospital care. The two plans carry roughly 50 percent of the health insurance for the metropolitan area.
The "usual, customary and reasonable" system used by Blue Shield in this area is similar to one employed by other Blue Shield plans around the country. The system has come under growing criticism from economists and government officials who see it as a contributing factor to the continuing escalation of medical care costs.
Under the UCR system, participating physicians are reimbursed according to what they choose to charge for a given procedure. Blue Shield records every charge made for each procedure or operation covered and sets a maximum based on the 90th percentile of what all patients were charged. In other words, the maximum reflects a fee based on what 80 percent of patients were charged. As physicians raise their fees - which they are free to do twice a year in the Washington area up to the maximum or 90th percentile - the maximum fee Blue Shield will pay also goes up. Blue Shield will recomputes the maximum or "customary" fee once a year to reflect the changes in what doctors are charging.
Blue Shield plans across the country also have come under fire for being dominated by the physicians whose bills they pay, thus allegedly short circuiting any attempt at restraining increases in fees charged. Of 23 voting members on the Washington area Blue Shield's government board of trustees, 23 are elected by Blue Shield participating physicians and 13 of those must also be physicians and 13 of those must also be physicians nominated by the local medical societies.
All committees have a majority of physician members. Seven of the eight members of the committee to review and approve bills that are not routine in nature are physicians.
ReP. Albert Gore Jr. (D-Tenn.), a subcommittee member, said the figures is the staff study were " a good illustration of the influence the UCR system has in Blue Shield plans in the United States." Gore said that "so long as the medical profession exercises control over the largest health insurance system in the United States, it's no wonder we have these increases."
A recent study of physician fees by the White House Council on Wage and Price Stability found that last year fees went up 9.3 percent, half again as much as the cost of living. THe council called this increase "disturbing" and fingered the UCR system of payment as being one of the contributing factors to continuing high rates of increase in physicaians fees.
Dr. Hervey Ammerman, president of the Medical Society of the District of Columbia, said that the cost of living had gone up 6 percent a year over the past three years. Ammerman said a combined committee of the medical society and the District of Columbia's hospital associalation is "studying the matter now" of what steps can be taken to control medical costs.
The figures contained in the staff study are for the maximum fees allowed and not for the average fees paid over the three-year period. The staff is continuing its analysis of the data obtained from Blue Shield and will have fuller figures at a later date, a staff member said yesterday.
Other procedures included in the staff study were:
Gall bladder, which went up from a maximum fee of $600 to $775, or 29 percent in three years; hysterectomy up from $750 to $1,000, or 33 percent in three years; hip replacement, an increase from $1,650 to $2,500 or 52 percent in three years; and a "simple" mastectomy, which went from $425 to $650, a 53 percent increase in three years.
Although the actual dollar increases for the laboratory procedures appear small, the volume of work paid for by Blue Shield indicates how small increase can be multiplied in the area. In 1977, about 262,000 complte blood counts were paid for by Blue Shield. The maximum fee for a blood count went up $1 from 1976 to 1977. About 120,000 pap smears were performed under Blue Shield in 1977. Their maximum fee was raised $2 in 1978. Electrocardiograms - 203,500 paid for in 1977 - had an increase of $3 in the maximum fee in 1978, urinalysis - 368,000 paid for by Blue Shield in 1977 - had a $1 increase in the maximum in 1978.
Walter J. McNerney, president of the national Blue Cross and Blue Shield associations, told the subcommittee that there was no evidence clearly suggesting that any Blue Shield plan, whatever its board composition, has acted in any way "other than in the best interest of its subscribers and the general public, which they are committeed to serving."