On July 5, 2017, Children’s Minnesota (Children’s) ended its contract with Blue Cross and Blue Shield of Minnesota (Blue Cross), leaving members to seek care with other children’s health providers in Minnesota.
We know many families value having access to Children’s and are rightfully concerned by this news.
We want you to know that Blue Cross is committed to continuing discussions with Children’s and resolving this negotiation, as we have done with every other provider in our network. Additionally, we feel a responsibility to correct some misinformation that has found its way into the public conversation and to share the following important facts regarding our position. While it is never our preference to negotiate in public, we believe you have a right to know where Blue Cross stands on these matters.
EVERY MEMBER WILL HAVE ACCESS TO THE CARE THEY NEED.
Blue Cross has been in regular conversations with our counterparts at Children’s, actively discussing complex cases that require close coordination for appropriate transfer to another hospital. We have co-reviewed literally thousands of cases submitted by Children’s, categorizing them by medical need and clarifying roles and responsibilities on how to ensure that every patient has a plan for either ongoing care at Children’s or a safe transition to continued care elsewhere.
To date, Blue Cross has approved 100 percent of the more than 4,000 patients submitted by Children’s for continued care at their hospital.
OTHER CHILDREN’S PROVIDERS IN MINNESOTA STAND READY TO TREAT CHILDREN’S MINNESOTA PATIENTS.
Minnesota is fortunate to have hospitals located throughout the Twin Cities and in Greater Minnesota that provide excellent pediatric care. They have the clinical abilities and capacity to serve Children’s patients, should that be necessary. Blue Cross has been in communications with the following in-network pediatric hospitals, all of which have the capacity to enroll new patients:
• University of Minnesota Children’s Masonic Hospital
• Gillette Children’s Specialty Healthcare
• Mayo Clinic Children’s Center
• Sanford Children’s Hospitals
• Shriners Hospitals for Children
We stand ready to help our members find new doctors or to help our doctors make new referrals to other specialists.
ER USE FOR SERIOUS AND LIFE-THREATENING MEDICAL EMERGENCIES ALWAYS PROCESSES AS IN-NETWORK, SINCE SOMEONE EXPERIENCING A TRUE EMERGENCY SHOULDN’T BE EXPECTED TO MAKE CARE DECISIONS BASED ON NETWORK STATUS.
However, for normal and routine services that should be seen in a clinic setting and not the ER, claims will be paid at out-of-network benefits with uncontracted rates. Children’s is required by law to help determine whether a patient is experiencing a medical emergency and if so, to provide appropriate treatment, regardless of health insurance coverage. Members shouldn’t be confused by Children’s inference that treatment in the ER automatically means covered treatment.
CHILDREN’S MINNESOTA, NOT BLUE CROSS, TERMINATED THE CONTRACT.
If Children’s had not done this, the contract and current payment rates would have continued until we reach a new agreement. Blue Cross has a long history of negotiating in good faith even after the renewal date comes and goes. We find it disappointing that Children’s would choose to walk away from our network instead of working with us collaboratively to negotiate a new agreement.
BLUE CROSS REMAINS FOCUSED ON REACHING A FAIR DEAL WITH CHILDREN’S MINNESOTA.
We have had numerous meetings with Children’s regarding their contract and we have exchanged multiple proposals. The latest proposal from Blue Cross is still above market rates, recognizing the unique specialty services offered to our members by Children’s.
BLUE CROSS HAS OFFERED CHILDREN’S A FAIR DEAL ON MEDICAID.
We proposed a multi-year approach to address their underlying Medicaid costs for inpatient services only. We are not asking Children’s to change how they are paid on outpatient services, which make up a majority of where patients receive hospital care. 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 31 percent cut to Medicaid cited by Children’s is inaccurate, entirely misleading and outdated. We have continued to negotiate in good faith in spite of Children’s decision to terminate their contract with Blue Cross. Those proposed contract terms are old, dating back to January 2017, and only applied to inpatient services (care after patients are admitted to the hospital). The current number being offered is less than half of what they cite, so that Blue Cross would be paying Children’s the same rates for Medicaid services as the State of Minnesota.
THE NEGOTIATIONS ARE NOT ONLY ABOUT MEDICAID, BUT ALSO INCLUDE INDIVIDUAL AND EMPLOYER COVERAGE.
In fact, Children’s is requesting rate increases on commercial business that are 30-50% higher than other large health systems are receiving for commercial increases. Children’s continues to state they need this level of increase because of their high government mix. However, based on publicly available data, Children’s government mix (Medicaid and Medicare) is actually lower that most other large health systems in our network — all of whom have accepted lower rate increases than Children’s is asking Blue Cross to provide.
In addition, Children’s is linking Medicaid rates to commercial insurance premiums. There is no relationship across segments, however Children’s is attempting to cost shift by claiming government mix issues. There is an affordability of care crisis which is why we hope Children’s will manage all aspects of health care costs whether it is for government or commercial members.
To be clear, we are offering Children’s rate increases on their commercial business that are in line with current market rates and inflation levels.
BLUE CROSS HAS REFUSED TO SPLIT CONTRACTS BETWEEN COMMERCIAL AND MEDICAID MEMBERS.
We find it concerning that Children’s would request to walk away from serving this population that requires unique needs despite us continuing to pay more than the State does for these services. We do not believe that allowing providers to choose which patients they accept based on payment method and levels is in the public interest. In addition, Children’s is not proposing a commercial increase that is acceptable as a standalone proposal regardless.
Driving more affordable care for our members is critical to our non-profit mission. We truly value the unique and specialized services that Children’s provides, which is why we choose to remain optimistic that a resolution can be reached.
