Deadline looms; no deal yet
By Matthew Whittle
Published in News on December 2, 2013 1:46 PM
With only three days left before the deadline passes, Wayne Memorial Hospital and Blue Cross and Blue Shield officials are no closer to a deal.
With just three days until Blue Cross and Blue Shield of North Carolina terminates its contract with Wayne Memorial Hospital, the two sides are no closer to an agreement than they were more than a week ago. But, in a statement released this morning, hospital officials pledged to hold Blue Cross customers harmless -- for a time -- even if it is pushed out of network by the insurance company, which it says has refused to negotiate in good faith.
"Over the past few weeks we provided multiple proposals that included significant concessions on our end in an effort to work toward an agreement. Unfortunately, Blue Cross responded three times with essentially the same offer, showing no willingness to compromise," the statement read. "It is hard to understand how this is negotiating in the spirit of good faith or partnership, and it certainly is not in the best interest of their members, the many Blue Cross customers who reside in Wayne and surrounding counties."
Speaking for Blue Cross, however, spokesman Lew Borman put the onus on the hospital Sunday night, saying the insurance company still had not received a response to the contract it put on the table Nov. 21 -- a contract it called then its final offer.
However, Wayne Memorial Chief Financial Officer Becky Craig explained Sunday night that Blue Cross' offer was still almost identical to the one it put forward on Nov. 8.
"We want to be in network," she said. "They've changed some language, but they haven't really responded to our last three offers."
The difference, she reiterated, is still about $6 million in revenue reductions over three years for the hospital.
Mrs. Craig explained that the hospital has offered more than $1 million per year over three years in revenue reductions, while Blue Cross is asking for about $3 million per year over three years.
The difference, she said, is the hospital is looking for protection from increases in costs of health care supplies and medicine.
"The real question is, should the hospital be responsible if inflation is higher than they're offering," she said. "But they are the largest insurer in the state and so they feel like they can say, 'Here's what we're giving you, figure it out.'"
And so far, she said, the hospital's leadership team and board of directors has been firm that Wayne Memorial cannot afford to accept what Blue Cross is offering -- not without "jeopardizing the long-term viability" of the hospital.
At the heart of the contract dispute, which has lasted now more than 20 months, is how Blue Cross' allowable rates for out-patient procedures are set. Under the current contract, which has been in place since 1995, the rates were a fixed percentage of the basic charge. Under the contract originally sought by Blue Cross, that rate would have been a fixed amount over a certain number of years, regardless of the basic charge.
Now, according to Mrs. Craig, while the hospital has come off the original language and has agreed to terms more in line with the original Blue Cross proposal, it is still seeking to have those rates tied, at least in part, to the federal Bureau of Labor Statistics' Hospital and Related Services Consumer Price Index.
Blue Cross, on the other hand, is still seeking more of a fixed amount, citing the need to rein in health care costs at Wayne Memorial for its policyholders. But, Borman said, is has tried to work out a fair deal.
"We have been sensitive to Wayne Memorial Hospital's concerns about revenue reductions and we have offered reasonable reductions," Borman said.
And now, he said, while the deadline to work out a new contract is still Wednesday, Blue Cross needs for the hospital to agree to terms today if it is to continue to keep Wayne Memorial in its network without any potential disruptions.
"They have until (today) to say whether or not they will choose to stay in our network," he said.
If Blue Cross does terminate the contract, though, the hospital will be considered out-of-network for all Blue Cross and Blue Shield of North Carolina policyholders, including county and state employees. According to Blue Cross, that means only emergency care and procedures approved through continuity-of-care forms will receive the in-network rates.
However, in its statement this morning, Wayne Memorial announced that "in order to protect our patients' access to care at their local hospital, and to give employers time to look into other insurance options that include Wayne Memorial as an in-network hospital," the board of directors has agreed to keep the out-of-pocket costs of Blue Cross customers at the current in-network rates through March 31, 2014, and through Dec. 31, 2014 for Blue Cross customers needing obstetrics services.
"This means there will be no change in the amount most of our patients pay for care at Wayne Memorial Hospital if we are out-of-network versus being in-network. We do not want patients to delay care or travel out of town when quality care is available locally at Wayne Memorial Hospital with the physicians they know and trust," the statement this morning read.