By Tim Bonfield
The Cincinnati Enquirer

One of the Tristate's largest insurers has agreed to increase payment rates for obstetrics and gynecology specialists, who have been frustrated in recent years by low reimbursement rates and soaring malpractice insurance fees.

In a series of contract deals with individual physicians and physician groups, Anthem Blue Cross & Blue Shield has won praise from doctors for being among the first in town to address their long-running economic concerns.

Of more than 200 Ob/Gyns in Greater Cincinnati, most have agreed to contracts with Anthem that run through 2005. The exact rate increases vary from group to group, and were not disclosed. But most doctors will see reimbursement rates swing from being less than standard Medicare rates to slightly higher than Medicare rates.

"We're not where we need to be, but this is a big first step. And we were able to do it without going on strike, without disrupting care and without leaving pregnant women looking for new doctors," said Dr. James Wendel of Mount Auburn Ob/Gyn Associates.

The deals, announced by doctors Thursday, reflect negotiations that ran from December into May. The unusual agreements have several implications.

For consumers, the contracts help resolve growing fears that obstetricians in Cincinnati would stop delivering babies over their concerns about malpractice insurance. And for a few years, Anthem customers can expect fewer doctors to pull out of their health plan networks over contract disputes.

For doctors, the agreement reflects newfound bargaining power from joining a union. One big reason the Ob/Gyn specialists won concessions from Anthem was the help they got from consultants with the Federation of Physicians and Dentists. The union attracted about 85 percent of local Ob/Gyn specialists about a year ago.

For insurers, Anthem's ability to get doctors to agree to multiyear contracts achieves a level of stability and predictability of health care costs that could become a model for dealing with other physicians in other specialties.

For employers, the contracts could mean another bump in ever-rising health care costs but one that may be easier to accept because the pain will be spread out over multiple years.

Anthem officials took action because they took seriously the malpractice concerns raised by physicians.

"We've been seeing that in other parts of the country and we were starting to see it here," said Paul Beckman, Anthem's vice president of health care management for southern Ohio.

Beckman said the contracts also should be viewed as a signal that insurers and employers are willing to work with doctors. "People have been reading about the crisis in health care," Beckman said. "But behind the scenes, doctors, insurers and employers are sitting down and working out arrangements that are satisfactory to everyone."

All sides agree that Ob/Gyns especially have suffered from sharp spikes in malpractice rates. In 1999, Dr. Wendel said it cost $19,000 to buy a year of malpractice coverage. This year, the bill was $58,000.

Yet for several years, insurance payments for many common surgical procedures have shrunk. . In 1992, Wendel said the area's biggest insurers paid an average of $1,689 for a hysterectomy. But this year, even with an unspecified increase from Anthem, the average will be $1,040.

Dr. Warren Metherd, a Cincinnati Ob/Gyn who helped lead negotiations with Anthem, praised the insurer for its willingness to make a deal.

"We appreciate Anthem taking the lead in these efforts," Metherd said. "It certainly identifies them as a physician-friendly company and one that sees the serious challenges to Ob/Gyn care here in the Cincinnati-Northern Kentucky area."

E-mail tbonfield@enquirer.com