Blue Shield of California and the Sutter Health network of doctors and hospitals have not reached an agreement after their contract expired, disputing terms as hundreds and thousands of patients in Northern and Central California are told to be ready to look someplace else for their healthcare needs.
Over 139,000 customers have already been informed by Blue Shield of the possible need to look for another doctor while 140,500 will follow later in the month as the health plan provider continues talks with Sutter Health. Their contract expired last Dec. 31, 2014 and so far discussions of terms aren't going smoothly.
According to Bill Gleeson, Sutter Health spokesperson, Blue Shield is demanding substantial payment cuts that would dramatically impact how the hospital network meets patient needs.
Blue Shield chief executive officer and president Paul Markovich countered that the health insurance company can't keep paying according to Sutter Health's rates as these are not only exorbitant but they also continue to rise. He added that Blue Shield also refuses to concede to a mandatory arbitration clause that protects Sutter Health from being sued in open court.
If the two don't reach an agreement, patients using Blue Shield plans will have to look for a new doctor to care for their needs, which for a lot means driving farther than usual even when a hospital is right there in their neighborhood.
According to Blue Shield's notice, its clients can continue going to doctors that are part of the Sutter Health network but they have to be ready to pay for potential out-of-pocket costs. If a new contract is still not reached after June 30, Sutter Health doctors will be considered out-of-network providers which will lead to a substantial increase in out-of-pocket costs.
Steve Shivinsky, Blue Shield spokesperson, said HMO members will be assigned new primary physicians starting April 1.
For Blue Shield customers in the Bay Area, this means they can no longer go to the Palo Alto Medical Foundation, the California Pacific Medical Center and the Alta Bates Summit Medical Center without at least paying some level of out-of-pocket cost.
Affected patients are irked that they are caught in the middle of the dispute but are particularly annoyed that they were only informed of the trouble after they had already signed up for coverage for 2015. At the next opportunity, most especially when there will be minimal to zero charges involved, many are considering jumping ship and signing up with other health plan providers.
