Concierge Physician Vs. BC/BS

Dr. Steven Knope was recently interviewed by the Arizona Republic about his concierge medicine practice. When Blue Cross/Blue Shield Insurance (BC/BS) heard about it, they chose to terminate his contract.

BC/BS claimed that they were "looking out for their members", to make sure that physicians charge the agreed-upon rates to BC/BS patients. But Knope points out that when he sees his concierge patients, it's a matter of private contract between him and them. According to this article in the September 5, 2008 Arizona Republic:

Knope... said he doesn't submit insurance claims to Blue Cross or any other insurance company for his 120 concierge patients. However, he has another 100 patients who are not part of his concierge practice. If Blue Cross terminates his contract, he said he will be forced to drop some of those patients.

"It is not going to hurt me financially, but it is going to hurt my (traditional-practice) patients," Knope said. Blue Cross "is hurting no one but their own members."

Rather than protecting their patients, BC/BS's actions look more like an effort to intimidate him and other like-minded physicians in an attempt to stifle a competing business model.

Fortunately, it appears that BC/BS's tactic will backfire. As Dr. Knope notes:

Because concierge doctors do not work for third-party payers, because we contract directly with our patients for medical care, being dropped from an insurance plan does not affect us. It does not affect our patients. The real story is not that another insurance company behaved badly. The real story is that it didn't matter!

And he stands to do financially better in the long run as a result of BC/BS's actions.

More significantly, Dr. Knope also explicitly recognizes and defends his stance in a principled fashion:

I'm all for free-market medicine and competition. Concierge medicine is the first example of real competition to enter the medical marketplace in years. This interchange with BC/BS is an example of how the free-market sorts things out. Blue Cross has every right to refuse to do business with me. Likewise, I can decline to do business with them. I don't need the government to protect me from "big business." I can simply offer a different kind of medical care and allow the public to choose where they want to spend their healthcare dollar.

I hope this business model takes off, since it offers tremendous promise for patients and physicians alike.