[StBernard] Blue Cross and Franciscans update

[Westley Annis]

State health deal far from certain



  


Blue Cross CEO 'not optimistic' 

*	By MARK BALLARD <mailto:mballard at theadvocate.com>  
*	Advocate Capitol News Bureau 
*	Published: Jan 13, 2010 - Page: 1A 


The leaders of the state's largest hospital system and Louisiana's biggest
insurance company, who have been feuding for weeks over the terms of a new
contract, say negotiations look promising but a resolution is not imminent.

An agreement likely will not be reached before the end of the contract Feb.
1. Both sides are preparing instructions for customers and patients on what
to do if Our Lady of the Lake Regional Medical Center - and its sister
institutions - are no longer part of the Blue Cross Blue Shield of Louisiana
network.

"I wouldn't want to characterize the breadth of the crevasse," said John
Finan Jr., the president and chief executive officer of Franciscan
Missionaries of Our Lady Health System. Called FMOL, the system owns six
hospitals, including the Lake, on Essen Lane.

"We're a lot closer than we were two weeks ago and both parties have made
concessions and we're working at getting the issues resolved and some of the
issues are being resolved," Finan said Tuesday afternoon after spending the
morning reviewing the latest counterproposal from Blue Cross.

"I am not optimistic that it's going to be resolved," said Mike Reitz, chief
executive office of Blue Cross.

"The answer to that question lies strictly in their court. Our proposal is
on the table. If they want to continue in our networks at what we offered in
this latest proposal then (Finan is) welcome to do so," Reitz said Tuesday.

The dispute has played out in high-profile commercials and newspaper ads.

At issue is how much Blue Cross will pay for services provided by FMOL
facilities and personnel. About 113,000 of FMOL's roughly 775,000 patients
last year were insured by Blue Cross Blue Shield of Louisiana, according to
Catherine Harrell, an FMOL spokeswoman.

Blue Cross pays doctors, nurses, hospitals and other medical providers a
percentage of the costs of providing health-care services for its clientele,
most of whom receive medical coverage through their employers. Like other
insurance companies, Blue Cross negotiates with health-care providers the
rate that will be paid.

For the next two years, which begins in February, Blue Cross wants FMOL to
accept either a zero percent increase or to accept a 3 percent rate increase
but require patients using Blue Cross to personally pay up to $4,000 out of
pocket for major procedures.

"Blue Cross wants to establish, in essence, a penalty to use our hospitals
and shift responsibility to the patient and we can't accept that," Finan
said.

Reitz said the idea is to confront patients with how much more FMOL services
cost than at comparable institutions.

"It's very difficult for us to recommend to our members that we continue to
pay for inefficiencies that occur in their system," Reitz said.

Finan denied that FMOL costs are out of line with comparable facilities in
Louisiana. He countered that Blue Cross, which recently increased its
premiums, is tossing around a lot of financial statistics that are
misleading in hopes of keeping the hospitals from receiving a fair increase
in rates, Finan said.

For instance, Reitz criticizes the amount FMOL charges to help pay the
medical costs not covered by the federal and state plans for the poor,
uninsured and elderly. Reitz said that FMOL charges 18 percent while the
statewide average is 5 percent in what is called "cost shifting."

"This cost-shifting mixture is what is creating some heartburn for us,"
Reitz said. "There has been no justification yet for the difference in their
cost structure for us to continue to pay them what we're paying them now."

Finan said Medicare pays by the case. Medicaid pays a daily rate. The amount
owed the government varies depending on how many patients of each program
are given care. "It's much more complex than his description would allow,"
Finan said.

If the two sides fail to agree by Feb. 1, patients with Blue Cross insurance
will have to pay considerably more for medical services at FMOL facilities.

Exactly how much more and what other changes are in the offing depend
largely on the specific policies, but both Blue Cross and FMOL are preparing
to help their clients weather the transition, Finan and Reitz said.

In general, if a patient needs emergency care, Blue Cross will pay. But when
the care is elective, an FMOL patient with Blue Cross insurance will pay
additional "out of system" fees, both said.




Thank you again Mr. Landry for picking them as the hospital administrators.
If OLOL/Franciscans run the hospital will this dropping by Blue Cross affect
the new hospital?




JY