Few doctors sign new KPS contract - perhaps because they don't have to

"When state Insurance Commissioner Deborah Senn signaled her support for a plan to rehabilitate KPS Health Plans in September, she anticipated between 80 and 90 percent of the insurer’s member physicians would re-up their contracts. So far, her estimate has proven overly optimistic.As the Dec. 1 deadline for contract approval draws near, only 18 percent of KPS Health Plans providers have signed their names on the dotted line.On Monday, the Office of the Insurance Commissioner reported that 58 of the 325 KPS Health Plans doctors signed the new contracts, which compel them to prorate billing to make up for the insurance provider’s debt (in exchange for future stock). However, OIC spokesman Jim Stevenson said the low numbers can be misleading because doctors who do not make a decision by the deadline will have their contracts automatically renewed.Stevenson estimated that only two or three doctors have rejected the contract.Stevenson said the OIC did not determine a critical mass of contract renewals in order for the insurance provider to survive. But he did say the KPS Health Plans rehabilitation team is asking doctors to clue them in as soon as possible. “We’ve asked doctors to let us know as soon as possible because there are a lot of mechanical decisions we’re hoping to make within this week,” Stevenson said. Doctors who continue as KPS Health Plans providers can look forward to prorating some of their medical bills to the collective tune of $6.1 million. The financial agreement is meant to raise revenue for the ailing health insurance provider, which is $9.1 million in the red.Doctors who reject the contract might never see the money KPS owes them. Previous KPS contracts had a provision compelling doctors to forgive debts if the company went into financial dire straights, according to OIC officials.KPS was put into receivership, or state financial review, on Aug. 2 after two years of intense monitoring by the OIC. In total, OIC officials found the company did not have the statutorily mandated $3 million in capital reserves and was an additional $3.1 million in debt. They estimated the company would lose $2.9 million more by year’s end.In September, a group of Kitsap business leaders, doctors and OIC officials came together to construct a plan to rehabilitate the company. The prorated fees in the doctor contracts are part of that plan."

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