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| FOR IMMEDIATE RELEASE | FOR MORE INFORMATION: |
| Monday, July 17, 2000 |
Bernard LaPine
(919) 281-7186 |
MAMSI Announces New Payment For North Carolina Physicians
Research Triangle Park, NC - Mid Atlantic Medical Services, Inc. (MAMSI) (NYSE: MME) announced today that effective August 1, 2000, all North Carolina physicians participating with its health plans will be reimbursed on a fee-for-service basis. As part of MAMSI's new direction, the company held a series of town hall meetings with North Carolina physicians. At these meetings, physicians urged MAMSI to end capitation and pay for professional services on a fee-for-service basis.
"Our physician partners urged us to modify our payment for professional services," said C. Franklin Church, M.D., MAMSI's North Carolina Medical Director. "This change will make it easier to recruit and retain physicians. Physicians will know they will be paid for the actual time and effort spent caring for our members."
Under capitation, Primary Care Physicians (PCPs) receive a fixed, monthly fee for each member assigned to the PCP's panel. The PCP receives the same reimbursement irrespective of the intensity or complexity of the services provided to health plan members. By contrast, under fee-for-service a physician is paid for the health care services given to a patient. The fee varies with the intensity and complexity of the actual service.
Over 5,000 physicians participate with MAMSI's health plans in North Carolina. The company's health plans in North Carolina include MAMSI Life and Health Insurance Company (MLH), Optimum Choice of the Carolinas, Inc. (OCCI) and Alliance PPO, LLC.
"This change is good news for our members and employer groups," Jim Bendel, Regional Vice President said. "Our members and employers want access to a large network of participating physicians, health care practitioners and facilities."
Mid Atlantic Medical Services, Inc.'s health care subsidiaries cover approximately 1.8 million lives in North Carolina, Maryland, Virginia, Pennsylvania, Delaware, West Virginia and Washington, D.C. The Company's Internet address is www.mamsi.com.
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Note 1: Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: All forward-looking information or statements contained in this release are based on management's current knowledge of factors, all with inherent risks and uncertainties, affecting MAMSI's business. MAMSI's actual results may differ materially if these assumptions prove invalid. Significant risk factors, while not all-inclusive, are: the possibility of increasing price competition in the Company's marketplace; the possibility of state or Federal budget mandates that reduce premium levels; the possibility of increased medical expenses due to increased utilization, inflation or legislative mandates; and the possibility that the Company is not able to expand its Service Area as planned. Investors should review other risks and uncertainties contained in Company documents filed with the Securities and Exchange Commission.