Under a new policy aimed at driving down the rate of Caesarean sections among its customers, Blue Cross and Blue Shield of New Jersey will pay physicians the same amount no matter what method of delivery is used.
To equalize reimbursements, the Newark-based insurer increased reimburse ments to obstetricians for vaginal deliveries and reduced payments for C-sections. To encourage patient education, physicians will receive an extra $100 for vaginal deliveries by women who have had a prior C-section.
Michael McGarvey, M.D., the Blues' senior vice president of health industry services, said the new rates eliminate what had been an average spread of $400 to $600 between C-section and vaginal delivery reimbursements. The policy takes effect immediately.
According to the latest available data from Health Insurance Association of America, the average physician fee for a C-section in 1991 was $2,236, or $611 more than the fee for a normal vaginal delivery.
The plan insures 1.6 million indemnity customers. The new policy doesn't affect its 250,000 managed-care customers.
New Jersey physicians eyed last week's announcement with a good dose of cynicism.
Gerald Burke, M.D., president of the New Jersey Obstetricians and Gynecology Society, said his first impression was that the Blues implemented the policy "to recoup the money they're going to be losing" on the state's newly mandated 48-hour inpatient stay for new moms (July 3, p. 10). Burke said he suspects that in lowering C-section rates and raising vaginal delivery rates, the Blues managed to lower its total costs.
McGarvey said savings to the plan are "very small" and that the decision to revamp physician payments is completely unrelated to the 48-hour mandate. The policy is intended to bring the plan's average C-section rate of 27.5% in line with the national rate of 22%. New Jersey's C-section average is 23.9%, he said. The plan hopes the new rates will "take economics out of the way of making a sound medical decision," he explained.
The Blue Cross and Blue Shield Association said about half the nation's 67 Blues plans have similar policies.
But it's not a common practice among commercial insurers, HIAA said.
Because of growing interest in such financial incentives, the American College of Obstetricians and Gynecologists issued an opinion last year, saying there's "little or no evidence" that the mode of delivery is motivated by differences in payment. ACOG said the delivery method should be determined on a case-by-case basis and not be driven by reimbursement considerations.
"The real concern there is, can you reduce something as complicated as that and as physician-judgment-driven as that to a dollars-and-cents issue?" said Ron Czajkowski, a spokesman for the New Jersey Hospital Association.