Two of Texas’ biggest health care providers, Dallas-based Baylor Scott & White Health and Richardson-based Blue Cross Blue Shield of Texas, are facing a looming deadline for contract negotiations between the two companies over reimbursements and other issues.
BCBSTX and BSWH notified members across the state through mail and email that if the two sides do not reach an agreement by July 1, hundreds of thousands of BSWH patients will lose access to BCBSTX health insurance.
According to BSWH, certain patients may still be eligible for care, such as those already hospitalized or those receiving treatment before July 1. This includes people being treated for a disability, acute illness, or life-threatening illness.
Eligible patients should apply as soon as possible by submitting a Continuing of Care form on the BCBSTX website. Members can also call the customer service phone number listed on their member ID card for more information.
The rest of us won’t be so lucky, as after July 1, BSWH may become “out of network” for BCBSTX users.
It’s the latest example of a trend of health care companies setting tight deadlines for contract negotiations. BCBSTX wrapped up negotiations with Medical City Healthcare last year, agreeing to a last-minute, one-year extension after months of negotiations.
The two companies have been fighting over reimbursement rates, the compensation providers receive for providing health care services. With rising labor and material costs, companies including Texas Health Resources and University of Texas Southwestern have been asking BCBSTX to increase reimbursements by $900 million over 32 months. But the two companies have been able to reach an agreement.
“This is really a repeat of what happened between BSWH and UT Southwestern,” said Marianne Feisen, executive director of the D-FW Health Business Group. “If you stop and think about it for a second, Baylor has its own hospital system and primary care organization, so I think BSWH has a lot more leverage than UT Southwestern had two years ago.”
This latest showdown between providers and insurers could have dire consequences. BCBSTX is the largest insurer in Texas, with more than 5 million members in every Texas county and nearly a quarter of the market, while BSWH has 52 hospitals and more than 800 patient care facilities across the state.
However, a representative from BSWH said that as of now, no one’s medical care will be interrupted between now and July 1.
“At Baylor Scott & White Health, our patients come first, and we are negotiating in good faith to avoid any disruptions,” the organization said in an emailed statement. Dallas Morning News“Currently, patients with BCBSTX health plans have in-network coverage with our providers and facilities, and we are working to reach a new agreement to maintain in-network coverage for BCBSTX plan holders by July 1, 2024.”
But BCBSTX said in a letter sent to members that no agreement is likely to be reached. news.
“Baylor Scott and White Health have notified us of their intent to move out of our network on July 1, 2024,” the company said in the memo. “We are working hard to reach an agreement, but if no agreement is reached, BSWH physicians, hospitals and facilities will be out of network for our customers.”
The problem ultimately is that health care is becoming too expensive to afford, Fazen said, and unless insurers, providers, and employers and employees find ways to bring costs down, health care companies will likely see a lot more short-term contracts in the future.
“After all, health care costs are so high that just providing it is putting employers out of business,” she said. “Employers have to find ways to avoid these costs, so they’re already starting to abandon traditional health care.”
BSWH has said it doesn’t plan to maintain its relationship with BCBSTX, but Fazen believes the two sides need to find common ground.
“This market is so big, so dynamic, and it’s only going to get bigger as companies move in,” Fazen said. “If they can’t come to an agreement, both sides stand to lose a lot of business. Who on either side wants to give up that business?”
