• The full, non-negotiated fees charged by doctors today are not exorbitant. They cannot be because they must be affordable for cash patients. The fees are reasonable, usual and customary because the market demands that they be. According to the federal government, UCR (usual, customary and reasonable) is defined as:  

“The amount paid for a medical service in a geographic area based on what providers in the area usually charge for the same or similar medical service. The UCR amount sometimes is used to determine the allowed amount.”


  •  Doctors cannot simply get more money from managed care plans by negotiating higher rates with health insurers due to antitrust law. According to the attached article, “Physicians Unions – An Antitrust Panacea?,” doctors are independent contractors, not employees, of managed care plans and so cannot join together and collectively bargain to drive up prices. When a managed care plan presents its fee schedule, it is a “take it or leave it” type offer. No counteroffers are ever considered.


  • With health insurance, doctors agree to reduced rates ONLY in exchange for the promise of an increase in volume of new patients. Such is not the case with PI. Doctors would get nothing in return by agreeing to reduce their fees in PI cases.


  • When settlements are negotiated in PI cases, if anyone believes the providers’ fees are too high then they can file for an “interpleader” hearing with the court that just heard the PI case. With such hearings, a judge hears from both sides and decides what fees actually are reasonable, usual and customary and should be paid. Accident victims, therefore, never have to pay exorbitant fees just because a lien has been filed.

  • To illustrate the reality and absurdity of this issue, we present the fee schedule of the largest chiropractic managed care organization in Arizona, American Specialty Health Networks (ASH). ASH contracts with BCBSAZ and CIGNA and so is the largest chiropractic managed care organization in the state. Their fee schedule is about a 70% discount off the full fee charged by a chiropractor to a cash or PI patient. Chiropractors simply cannot meet overhead with these fees and so need to collect their full fee whenever possible and especially in PI cases.


  • For spinal manipulation, ASH pays $26. For hot or cold packs, or for electrical stimulation, ASH pays $6. ASH usually only pays for one physical therapy modality per visit, therefore the total paid per visit is usually $32. UCR rates are $50-55 for a spinal manipulation and $20-30 for each modality with coverage for 2-3 modalities per visit, total at least $100 per visit. Therefore, ASH is about a 2/3rds discount off UCR, not a payment that covers overhead in a chiropractic office.


  • The law requires that all patients be charged the same fees and so the chiropractors’ UCR fee schedule must be reasonable and within reach of cash patients. DCs charge what insurers agree is UCR because the doctors do not like to write off unpayable/uncollectible amounts all the time. They like to get paid for 100% of what they bill.



  • It would be better to address this problem in other ways such as allowing doctors to collectively bargain with managed care plans so that they could negotiate a livable fee. Alternatively, it could be mandated that the doctors’ fees not exceed what is usual, customary and reasonable in the community. If that were in place, liens would never be exorbitantly high or excessive.


  • Also, it is definitely true that plaintiffs’ attorneys use the full, non-negotiated doctors’ fees as a basis for negotiating the final settlement, despite what was said during testimony. I have testified in 78 trials in the past 15 years and so know what goes on in the courtroom. Settlements are definitely not made on the basis of negotiated, discounted managed care fees. I am certain of this fact.