BLUE CROSS: Raises Reimbursement For Three Hospitals
In his Sunday Los Angeles Times column, Ken Reich reports that three San Gabriel Valley Hospitals have forced Blue Cross of California to raise reimbursement rates for medical procedures at those facilities. The three-year contracts, signed "in the last two weeks" with Huntington Memorial Hospital in Pasadena, Methodist Hospital in Arcadia and Huntington East Valley Hospital in Glendora, were subject to confidentiality protocols, "but some details have been leaking out." Two sources indicated that the hospitals won an average reimbursement increase of 8%, although Blue Cross "termed this too high." One source said "those hospitals got about 98% of everything they wanted" from the insurer. Blue Cross Senior Vice President Andrew Allocco said, "If they said they got 98% of what they wanted, that's fine. From my standpoint, that's great. We attempt to have a win-win situation."
Reich notes that while Blue Cross initially wanted to pay 1995 rates, they "didn't get away with it," because the three facilities adopted a negotiating tactic that recently proved effective for Sutter Health and Catholic Healthcare West. Those two health systems, representing over 70 hospitals, issued press releases after talks stalled "saying there was an impasse and [they were] setting a date for terminating their arrangements with Blue Cross." The insurer blinked. Reich writes that the move shows "that big health plans are willing to negotiate, so long as medical providers are willing to be tough enough. ... Other hospitals, doctors and medical providers should take note" (1/3).