Dive Brief:
-
Blue Cross and Blue Shield of Minnesota and Children's Hospitals and Clinics of Minnesota are experiencing a contract disagreement that is currently set to end on July 5. Blue Cross said if its contract proposal isn’t approved, Children’s Hospital patients will be cared for by other facilities, including the University of Minnesota's Children's Masonic Hospital, Mayo Clinic Children's Center, Gillette Children's Specialty Healthcare, Sanford Children's Hospitals and Shriners Hospitals for Children.
-
With the contract soon ending, Children’s Hospitals and Clinics of Minnesota created a website in hopes of turning up the pressure on one of Minnesota’s largest insurers, Minneapolis/St. Paul Business Journal reported.
-
Children’s launched Stand Tall For Small and hosted a press conference on Monday that included remarks from hospital executives and a patient’s mother. The hospital said Blue Cross’ contract proposal would increase costs for patients and would affect more than 66,000 Blue Cross members.
Dive Insight:
On its new site, Children’s Hospital said Blue Cross and Blue Shield of Minnesota demanded a 31% cut to payments for children insured by Medicaid who are treated at the hospital. Children’s officials said they will need to cut services if those payment reductions are realized.
“Accepting Blue Cross’ demand would threaten our long-term viability, and force us to start eliminating services and programs that provide necessary pediatric care to all children in our community. We simply cannot agree to terms that would threaten our future,” according to Children’s on its new website. “We are not asking for big increases or to be paid at above-market rates. We need a fair contract that preserves the rates we are paid for children who rely on Medicaid, so we can continue to provide the life-changing and lifesaving care that families rely on.”
Blue Cross Blue Shield of Minnesota also took to the internet. Via a blog post, the payer said it made “every effort” to reach an agreement and disputed the 31% reduction figure. It called the figure “misleading and outdated.” The insurance company blamed Children’s for terminating the contract. The insurance company said it offered a “fair” multi-year deal.
“We are not asking Children’s to change how they are paid on outpatient services, which make up a majority of where patients receive hospital care. We are simply asking Children’s to be paid within a reasonable range of what other comparable providers are paid for inpatient services, while still offering a premium for the unique services Children’s provides,” the insurance company wrote.
Blue Cross and Blue Shield of Minnesota said the negotiations aren't just about Medicaid, but also include individual and employer coverage. The insurer added that Children’s is requesting rate increases on private insurance of 30-50% higher than other large health systems. Blue Cross and Blue Shield of Minnesota said it’s proposed rate increases for Children’s commercial business that are in line with current market rates.
“Driving more affordable care for our members is critical to our nonprofit mission. We truly value the unique and specialized services that Children’s provides, which is why we choose to remain optimistic that a resolution can be reached,” wrote the insurance company.
The contract battle features one of the state's largest payers against the largest child care delivery system in the Minneapolis area. The fact that it deals with children's healthcare and Medicaid makes the contract dispute even more troublesome. Will the two sides reach an agreement by the deadline? There is only a week to go, but the fact that both sides are now going public with their sides is actually a positive. Neither wants to blink, but they also hope that turning up the heat publicly may lead to a contract that both can support.