Many caught in middle as Blue Cross/CHI fight drags on


November 29th, 2014

Lincoln, NE – The latest round in the battle occurred last week, when Blue Cross and Blue Shield held a conference call to respond to Catholic Health Initiatives latest contract proposal in the on-again, off-again negotiations.


Pat Bourne is a Blue Cross/Blue Shield vice president:

“While we’re not accepting that proposal, we welcome the opportunity to sit down with CHI and work on real solutions that make sense to Nebraskans,” Bourne said.

Cliff Robertson, head of CHI Nebraska, said he was surprised and dismayed:

“What we put on the table was a real offer, a real solution to entice Blue Cross to partner with us to lower health care costs for Nebraskans, and they walked away from it,” Robertson said.

St. Elizabeth hospital in Lincoln (Photo by Fred Knapp, NET News)

St. Elizabeth hospital in Lincoln (Photo by Fred Knapp, NET News)

The dispute is over the money Blue Cross pays CHI to take care of its policyholders. CHI says its offer would have saved $10 million. Blue Cross wants closer to $60 million in savings. And Blue Cross’s Bourne says the company is particularly concerned about one aspect of what CHI is doing:

“Perhaps the most troubling part of this proposal is the threat by CHI that if we did not sign this in 72 hours that they would “balance bill” our members,” Bourne said.

Balance billing means charging people the price on the so-called “charge master list” – in effect, the sticker price. For example, that could be $30,000 for an appendectomy, compared to the $18,000 discounted price the insurance company and hospital chain previously negotiated. In five Nebraska communities where CHI has the only hospital – Kearney, Grand Island, Nebraska City, Schuyler and Plainview, both sides have continued to honor the old, agreed upon prices even after the contract expired September 1.

But CHI’s Robertson says that will change January 1, when the hospitals will begin to bill Blue Cross for the full sticker price. “We’ll bill Blue Cross, and then Blue Cross has to determine how much they pay and how much they expect their member to pay,” Robertson said.

Blue Cross Blue Shield spokesman Andy Williams says if people have to pay more, it won’t be the insurance company’s fault:

“You won’t get a bill from Blue Cross. “It’s not between us and our members how much you have to pay. It’s between you and that doctor or hospital,” Williams said.

Meanwhile, the crunch is already hitting CHI hospitals in Lincoln and Omaha, where Blue Cross is reimbursing claims at its out-of-network rates – generally half the in-network rates. Williams of Blue Cross says the insurance company’s figures show business at Lincoln’s St. Elizabeth Regional Medical Center is way down:

“People are voting with their feet,” Williams said. “They’ve figured out ‘Okay, it’s going to cost me a lot more if I go to that hospital vs. that one. I don’t care. They’re both good hospitals. I’ll go to the one that’s going to be cheaper.

Williams says Blue Cross is paying a weekly average of $465,000 in claims at St. Elizabeth, down about 60 percent from the $1.2 million average of weekly payments before out-of network reimbursement started Sept. 1.

CHI spokeswoman Jodi Hoatson acknowledges, as she puts it, that Blue Cross has “succeeded in forcing a relatively large number of Nebraskans to leave the CHI Health doctors and hospitals.” But she adds “Our concern is not about this lost business. Of greater concern is that Blue Cross has threatened patient safety and choice with its efforts to reshape the market to fit its business goals.”

However Dr. Ron Hill, part of an anesthesiology group that provides services at St. Elizabeth, says the loss of business has definitely affected him:

“For me and my colleagues the problem has mostly been that there has been a decreased amount of patients having surgery at CHI Health St. Elizabeth,” Dr. Hill said. “And because of that, since I deliver anesthesia, we haven’t been able to provide that service, and therefore our income has decreased immensely.”

Hill says he bears no ill will, and wishes CHI success. But he said his group will discontinue its contract with St. Elizabeth effective Nov. 30.

A St. Elizabeth spokesperson did not respond to requests for comment from the hospital. But in a YouTube video for CHI employees in late September, the company’s CEO Robertson was reassuring about CHI’s finances:

“We are part of a large organization that has a huge amount of cash sitting on its balance sheet,” Robertson said. “We do have the financial wherewithal to navigate through this storm. That doesn’t mean it isn’t painful, doesn’t mean that patients and employers aren’t being thrown in the middle of something that they should have never been thrown in the middle of. But it doesn’t mean we don’t have to worry about checks bouncing or retirement savings not being there for us when we retire.”

Robertson also said many employers in the state are reconsidering whether to keep Blue Cross as their insurance carrier. Blue Cross’s Williams counters employers are continuing to sign up for coverage. How all this shakes out, for patients, medical providers, and hospitals, may not be clear until the new year.

Comments are closed.

©2023 KVNO News