Blue Cross Will Cover Services at Six Rural Sutter Hospitals

Blue Cross of California yesterday proposed a plan that would allow preferred provider organization members to continue to use six Sutter Health hospitals located in rural areas, the San Francisco Chronicle reports. The HMO stated that it has agreed to reimburse these hospitals for services "because there is no non-Sutter facility within a reasonable driving distance," the Chronicle reports. The hospitals include Sutter Auburn Faith Hospital in Auburn, Sutter Amador Hospital in Jackson, Sutter Coast Hospital in Crescent City, Sutter Delta Medical Center in Antioch, Sutter Lakeside Hospital in Lakeport and Memorial Hospital of Los Banos (Colliver, San Francisco Chronicle, 1/9). Blue Cross officials said that treatment at most of Sutter's other Northern California facilities would no longer be covered for PPO members (Rose, Santa Rosa Press-Democrat, 1/9). Mark Weinberg, group president for Blue Cross of California, said, "We believe the steps we've taken ... will mitigate most of the difficulties and concerns our members have had" (San Francisco Chronicle, 1/9).

Blue Cross' proposal "caught Sutter by surprise," however, because the insurer did not notify the health system before announcing its plan. "I'm at a complete loss," Sutter spokesperson Bill Gleeson said, adding, "It's irresponsible for them to contact reporters and then expect members to get news that is disjointed" (Rapaport, Sacramento Bee, 1/9). Gleeson added, however, "Our position is if Blue Cross authorizes it, we provide it" (San Francisco Chronicle, 1/9). Blue Cross officials cited "complaints from unhappy Blue Cross members" and "logistical problems" in transferring members to different providers as the impetus behind their decision to allow some members to remain with Sutter Health providers. Blue Cross PPO members had previously been notified by the company that Sutter providers would be paid at out-of-network rates, allowing physicians to bill patients for the difference. The contract between Blue Cross and Sutter Health expired on Dec. 31, and most Blue Cross enrollees have until Jan. 31 to find a new provider. Blue Cross has stated, however, that while no new contract negotiations are underway between the two groups, the new plan for PPO members could continue "indefinitely" (Santa Rosa Press-Democrat, 1/9).