An insurer or a participant in an insurance arrangement may enter into contracts to purchase health services on a bid or negotiated basis with health providers at alternative rates of reimbursement and offer such benefit to insureds. Such insurers and participants in insurance arrangements may offer or administer a health benefit plan including preferred provider policies or contracts which limit the number and types of providers of health services eligible for payment as preferred providers under such policies or contracts. Insurers and participants in insurance arrangements may establish terms and conditions which shall be met by a provider of health services in order to qualify for payment as a preferred provider under such policies or contracts. Such terms and conditions may include provisions which identify the method of payment for services, including, but not limited to, development of prospective reimbursement systems.