Blue Cross Blue Shield of Texas members no longer have in-network access to Bryan and College Station CHI St. Joseph hospitals after leaders failed to reach an agreement on health care costs.
The change is expected to impact about 65,000 Blue Cross Blue Shield members across CHI’s Texas locations, St. Luke’s Health CEO Doug Lawson said Thursday.
CHI St. Luke’s Health, whose parent organization is CommonSpirit Health, is made up of 16 hospitals across Houston, Bryan-College Station and East Texas, including the Bryan and College Station CHI St. Joseph hospitals.
On June 17, CHI St. Luke’s Health issued BCBSTX a 180-day notice of termination with intent to renegotiate. In October, Lawson said that Blue Cross Blue Shield of Texas reimbursement rates are 25% or more below competitors’ rates. He said without an increase in rates, the hospital’s ability to function properly could be compromised.
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“I’m very disappointed that despite the discussions that have gone on for the last year that we reached this point and had been unable to reach an agreement that allows St. Luke’s health system the opportunity to serve the individuals covered by the Blue Cross Blue Shield insurance programs,” Lawson said Thursday. “I continue to be willing, available and interested in resuming our discussions and establishing a long-term relationship with Blue Cross Blue Shield that extends our combined values across the communities that we serve.”
Lawson said whether negotiations continue is up to Blue Cross Blue Shield.
CommonSpirit Health was requesting double-digit increases in the prices that BCBSTX members pay, according to the health insurance provider’s Thursday press release. The statement continues, saying that BCBSTX’s offer was not accepted.
Moving forward with the amount that CommonSpirit requested would have driven up the cost of health care in the Houston area and southeast Texas region, Shara McClure, BCBSTX’s divisional senior vice president for Texas Health Care Delivery said in the release.
“Understandably, any change to the BCBSTX provider networks is cause for concern for our members,” McClure said. “We’ve contacted other in-network hospitals, and they’ve assured us that they can and will welcome our members. Our priority is to help our members experience as little inconvenience as possible as they change to other quality, credentialed health care providers in our network.”
BCBSTX is working to speed up granting privileges to doctors who only have privileges at CommonSpirit Health and is asking members to talk with their doctors about options, McClure said.
BCBSTX is Texas A&M University System’s main health insurance provider.
A&M employees, retirees and their covered dependents will still have access to in-network hospitals and health care facilities throughout the areas served by CommonSpirit Health, Texas A&M System Vice Chancellor of Marketing and Communications Laylan Copelin said via email.
“The Texas A&M System is providing members with several resources, both online and with our BlueCross and BlueShield of Texas dedicated customer service team, to help them determine if they are affected or not — and what alternatives would be available to them if needed,” he continued. “In some instances, members with ongoing conditions may still be able to use CommonSpirit Health facilities if they qualify for continuity of care.”
CHI St. Luke’s may be justified in its demand for a rate increase this year, health economist at Rice University’s Baker Institute for Public Policy Vivian Ho argued in a Wednesday opinion piece in the Houston Chronicle. In her piece, Ho said that there is data that shows Blue Cross Blue Shield could potentially raise the prices it pays CHI St. Luke’s while holding down overall costs for BCBSTX members.
“Removing CHI St. Luke’s from the Blue Cross Blue Shield network could raise the average cost per insuree as patients seek care from the former’s higher-priced competitors,” her piece reads.
Ho told the Houston Chronicle in a separate article that she doesn’t think CHI St. Luke’s will remain out of the Blue Cross network for long “because they rely too much on each other’s business.”
Consumers will likely begin using alternate providers in the Brazos Valley more frequently, and will probably ask their doctors to schedule appointments for them at their other in-network facilities rather than CHI’s since it is out of network, Laura Dague said. Dague is an associate professor of health policy at the Bush School of Government and Public Service.
But there may be some people who prefer to stay at CHI no matter the cost, she added.
“If consumers aren’t willing to switch providers, then we’re just going to see prices keep going up,” she said.
Seeing the termination go into effect is a bit surprising but doesn’t mean that negotiations cannot continue in the future, said Venky Shankar, director of research at the Center for Retailing Studies at A&M’s Mays Business School.
With fewer people opting for routine visits and elective visits to the hospital due to the COVID-19 pandemic, Shankar said that the termination may not make as much of a difference as it would in a typical year. He said this could potentially prolong the time it will take for CHI to be in-network with Blue Cross again. But he said waiting too long will mean that the hospital will begin losing patients.
“It’s unfortunate,” Shankar said, noting that some patients will no longer have the rates they expected. “The patient is the casualty.”
For more information, go to bcbstx.com/commonspirit or fairratesforstlukes.com.