August 1999 Bulletin

Here's how it works

The Texas Medical Association outlined the following steps on how the physician negotiation law works.

Step one

Individual physicians want help negotiating with a large managed care plan that has presented each of them with a take-it-or-leave-it contract containing provisions the physicians fear could harm their patients.

Step two

The doctors decide who should be included in their group and they either hire professional help-a health attorney, former managed care executive or business manager, for example-or decide to represent themselves in the negotiation.

Step three

The physicians apply to the Texas attorney general for permission to meet, communicate and negotiate with the health plan. The attorney general may deny the request if the physicians constitute too large a share of the total physician market or dominate any one specialty area.

Step four

If permission is granted by the attorney general, the physicians approach the health plan and ask to negotiate contract provisions. Except in very special cases as approved by the attorney general, fees and reimbursement rates are not allowed for discussion. Fees can be discussed only when the attorney general determines that the health plan controls a substantial portion of the local health care market, leading to possible access problems for patients. In no case can Medicaid fees be discussed.

Step five

The health plan may or may not choose to come to the table. Negotiations are voluntary and nonbinding and may be needed at any time by either party. Even during negotiations, the plan is free to approach individual members of the physician group.

Step six

If an agreement is reached, the attorney general must review it to make sure the agreement is reasonable, will not hurt competition and will serve the best interests of consumers. The agreement cannot go into effect without the approval of the attorney general.

Step seven

Boycotts or other cessation of patient care are strictly prohibited. Also prohibited are negotiations to remove a requirement that physicians participate in all products offered by the health plan.


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