Paying the Physician's Fee

Abstract

At a time of debate over physicians' fees and income, we describe the evolution of Blue Shield plans and programs to pay physicians' fees. We review how Medicare's "reasonable-charge" formulas fostered Blue Shield "usual, customary, and reasonable" (UCR) contracts. In a three-year period in the Washington, DC, area, Blue Shield UCR protocols permitted "customary" allowances for selected surgical procedures to rise 29 to 75 per cent; charges by two physicians increased allowances for coronary-artery bypass from $2000 to $3500.