BCBS Illinois Implements Non-PPO Reimbursement Methodology

News from the Blues for Producers - Blue Cross and Blue Shield of Illinois


September 1, 2010

BCBSIL’s Migration to a New Non-contracted Reimbursement Approach [All Markets]

Blue Cross and Blue Shield of Illinois (BCBSIL) is migrating to a new non-contracted reimbursement approach. As groups renew with BCBSIL, the majority of non-contracted provider claims will be reimbursed based on a pre-determined percentage, as set forth in the certificate of coverage provided to members, of Medicare reimbursement rates. Medicare provides a national standard recognized by all providers that is used to reimburse a significant portion of all medical claims in the United States. As a result, we expect the new methodology to increase transparency for providers and members through availability of information about Medicare standards. In a number of isolated instances, such as when a service is not priced by Medicare, a default pricing method will be used. This will be stated in the certificate of coverage. Our methodology has been submitted and approved by state regulators in Illinois. Please note that Medicare-based reimbursement rates for non-contracted providers will not have any impact on our Medicare Secondary Payer process.        

We will begin meeting with our ASO group customers to explain the new Medicare-based methodology and to walk through options available for particular plans. We anticipate that the overall impact of the new methodology will not be significant due to Health Care Service Corporation’s broad independently contracted provider network, which results in over 97 percent of all claims we process to be in network.

To help avoid confusion for members during the transition to the new methodology, communication tools will be provided to the FSUs to address any concerns. Members will also be encouraged to continue to get estimates from non-contracted providers for the cost of services and to call us to help determine estimated allowable amount.

A Division of Health Care Service Corporation, a Mutual Legal Reserve Company,
an Independent Licensee of the Blue Cross and Blue Shield Association.


 Editor’s Note: We applaud BCBS Illinois for this move towards greater transparency. We only hope that more payers will do the same and even take it a step further; eliminate lucrative PPO contracts entirely and pay fair and reasonable reimbursement rates.