Blue Cross and Blue Shield of Minnesota and Children's Hospitals and Clinics of Minnesota did not come to an agreement on a new contract by a July 5 deadline, which means the health system is no longer in the payer’s network, Star Tribune reported.
The stalemate affects about 66,000 patients covered by Blue Cross and Blue Shield of Minnesota, who will now likely have to pay higher out-of-network costs for care at the health system or seek care elsewhere.
Blue Cross and Blue Shield of Minnesota said patients can receive in-network patient care at nearby 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.
The contract stalemate affects many area children’s facilities, including the Minneapolis and St. Paul hospitals, Special Care Nursery in Coon Rapids, 12 primary care clinics, all specialty clinics, six rehab sites in the Twin Cities and the Minnetonka Ambulatory Surgical Center and home care services.
Children’s Minnesota CEO Bob Bonar said the payer “gave Children’s an impossible ultimatum, knowingly threatening our ability to care for the kids and families that rely on us every day and the vitality of our organization.”
Garrett Black, Blue Cross and Blue Shield of Minnesota SVP of health services, said the payer found “it disappointing that Children’s would choose to walk away from our network instead of working with us collaboratively to negotiate a new agreement.”
The disagreement has dragged on for months. Children’s said the payer demanded a 31% cut to payments for children insured by Medicaid who are treated at Children’s, which would result in the health system needing to cut services and could threaten Children's future. Hospital officials said they weren’t asking for above-market rates, but only wanted a “fair contract that preserves the rates we are paid for children who rely on Medicaid.”
Blue Cross and Blue Shield of Minnesota disputed the 31% reduction figure and called it “misleading and outdated.” The payer maintained it was offering a fair multi-year deal.
“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.
The Children's system is now considered out-of-network for Blue Cross and Blue Shield of Minnesota, but the two sides could still come to an agreement on a new contract. However, until that happens, the largest child care delivery system in the Minneapolis area isn’t an in-network provider under one of the state’s largest payers.