Springfield Clinic may be out-of-network for patients with Blue Cross
Springfield Clinic began telling 100,000 of its central Illinois patients Wednesday to prepare for potentially higher out-of-pocket costs because the clinic probably will lose its in-network status for Blue Cross and Blue Shield preferred-provider plans.
Emails will be sent out to patients first, followed by letters in the mail, clinic spokesman Zach Kerker said.
The Springfield Clinic email is in response to a contractual dispute between the clinic and Blue Cross and Blue Shield of Illinois over rates paid to doctors and other health care providers at the clinic.
First reported by The State Journal-Register in June, the dispute would result in all Springfield Clinic providers being considered out-of-network for services that Blue Cross members obtain Aug. 19 and beyond at the clinic’s Ambulatory Surgery and Endoscopy Center in Springfield. Then on Nov. 17, all of the clinic’s more than 600 providers would be considered out-of-network.
“This is a direct result of BCBSIL’s recent decision to terminate Springfield Clinic as an in-network provider for all its commercial PPO plans,” the email from the clinic’s chief executive officer, board chairman and board of directors said.
“It’s critical that you understand that we do not anticipate a resolution with BCBSIL,” the email said. “While the decision to terminate in-network coverage was not made by us, it impacts more than 100,000 patients who rely on our care. Our promise to you is to advocate for partnerships that support health care in central Illinois today and in years to come.”
If the dispute isn’t resolved, patients could be faced with the choice of paying much higher out-of-pocket costs to keep longtime doctors or leaving those doctors in search of specialists that, in some cases, would require travel to communities outside the Springfield area.
A Blue Cross official told the SJ-R in June that discussions with the clinic over the continuation of a smaller contract — one covering state of Illinois and some other employer groups — resulted in clinic officials taking the unusual step of voiding that contract.
The Blue Cross official said the company terminated its other Blue Cross network agreements with the clinic in hopes of restarting negotiations on the smaller contract and also to promote a “broader discussion” with the clinic about value and quality in contracts.
Blue Cross then notified the clinic of the August and November official termination dates.
The Springfield Clinic email encourages Blue Cross members to ask their employers whether they can change plans to avoid potentially higher costs and retain clinic doctors, or ask Blue Cross whether patients can temporarily continue with a Springfield Clinic provider during a pregnancy, cancer treatment or other ongoing treatment.
The clinic is operating a call center on the issue for patients from 8 a.m. to 5 p.m. Monday through Friday at 217-391-7086. The clinic also is posting information at springfieldclinic.com/bcbs.
When contacted by the SJ-R, Chicago-based officials from Blue Cross, the largest health insurance company in the state, issued a statement that held out hope for a resolution to the disagreement and implied the clinic’s demands were unreasonable.
“We’re diligently working with Springfield Clinic to find a solution that is in the best interest of our members,” the statement said. “As advocates for our members and employer groups, we have priorities that must be addressed, including providing our members with access to quality health care without sacrificing the value of their monthly premium dollars and unnecessarily increasing out-of-pocket costs.”
The statement added: “We take our members’ access to health care seriously — our focus is providing access to high-quality, affordable care, not agreeing to artificial, above-market reimbursement without regard to access, quality and value.”
Blue Cross officials said they are “committed to working with Springfield Clinic to find a solution that will ensure our members are getting the right care, at the right place, for the right price.”
Regardless of whether Springfield Clinic remains an in-network provider, Blue Cross officials said every Blue Cross-insured member will “have access to quality, affordable health care through our robust provider networks throughout central Illinois.”
Springfield Clinic officials wouldn’t say what percentage of its revenue the for-profit clinic would stand to lose if patients insured through Blue Cross and Blue Shield of Illinois and out-of-town Blue Cross plans decide to leave their clinic providers.
But clinic officials indicated that agreeing to a rate structure harming its ability to attract and retain doctors in central Illinois would harm not only the clinic but its patients in the long term.
The clinic email said it will reject contract terms that would, in the long term, “threaten the care we provide to 20 rural counties,” “restrict our ability to acquire the latest innovative treatments and technologies” or “jeopardize our ability to retain our providers and employees, impacting care you’ve come to expect from us.”
Springfield Clinic operates medical practices in Springfield and communities that include Sherman, Carlinville, Decatur, Hillsboro, Lincoln, Litchfield, Macomb, Peoria, Taylorville and Effingham.
The clinic is one of the largest multi-specialty medical groups in the state and has more than 3,000 clinical and administrative employees.
The uncertainty is worrying executives at Springfield-based Mel-O-Cream Donuts International, which sells 1.4 million doughnuts each year in Springfield and in supermarkets and convenience stores within a 600-mile radius.
About 60 of the company’s 120 employees have opted for employer-sponsored coverage through Blue Cross and Blue Shield, company officials said.
Mel-O-Cream “paid a premium” for the Blue Cross plan because employees valued their Springfield Clinic providers, Mel-O-Cream chief operating officer Chad Larson said.
The company’s Blue Cross plan, renewed on April 1, will have less value for employees and the company without the clinic as an in-network provider, he said.
By dropping Springfield as an in-network provider, Blue Cross is “somewhat reneging on what they sold us,” he said.
Larson said he was “disheartened” to see the two sides not yet able to resolve their differences. The potential change would have the most effect on employees and dependents who are going through treatments and need continuity, he said.
Co-pays and deductibles for out-of-network care are double what patients pay for in-network care through Mel-O-Cream’s contract with Blue Cross, according to Dave Ryan, the company’s human resources director.
Larson said Mel-O-Cream employees “have established caregivers. They don’t want to change.”
Springfield Clinic has been encouraging representatives of employers in recent weeks to switch their coverage to another insurer to avoid the potential impact of the dispute, according to Drew Davis, a health care benefits consultant at Davis Financial Group.
He said Blue Cross PPO plans cover more than half of all Springfield-area residents, and at least 40% of all Springfield Clinic patients have Blue Cross insurance.
“The clinic probably needs Blue Cross more than Blue Cross needs the clinic,” Davis said.
Springfield Clinic doesn’t disclose financial performance data but reportedly posts more than $400 million in revenues annually. Blue Cross’ parent company, Chicago-based Health Care Service Corp., reported $3.9 billion in net annual income in 2020, a 75% increase compared with 2019. HCSC also operates Blue Cross plans in Montana, New Mexico, Oklahoma and Texas.
Davis said he hopes the Blue Cross contract terminations with Springfield Clinic don’t take place.
“It would be a huge change for patients — massive,” he said. “People are not going to pay more for insurance. They’re paying too much already. They’re not going to pay more because the clinic thinks they should.”
Both Davis and Andrew Novaria, a health insurance broker at American Central Insurance Services in Springfield, said the statements from both sides may be part of their negotiating ing strategies.
Many local employers probably will wait until September or October until deciding whether to investigate switching from Blue Cross to another insurance carrier in advance of Nov. 17, Novaria said.
Employers would have to weigh whether another carrier would cost them more to retain Springfield Clinic as an in-network option and whether that benefit would be worth the cost, he said.
For local workers employed by companies with national Blue Cross contracts and operations throughout the country, the likelihood of such companies changing insurers to help central Illinois patients retain Springfield Clinic doctors would be remote, Davis said.
Springfield School District 186’s employee health insurance has been provided by Blue Cross for several years, district spokeswoman Bree Hankins said. “It is not our wish to switch carriers, but a change of this magnitude affects the continuity of care and convenience of high-quality local services for our employees,” she said.
Hankins said the district, in consultation with unions representing district employees, has “decided to be prudent and explore other insurance carriers and seek proposals that include in-network coverage of services and providers with Memorial, HSHS, Springfield Clinic and SIU Medicine in the event that a resolution between these two parties cannot be reached.”
Patients hate the prospect of changing doctors, especially if they are going through a pregnancy or have chronic conditions that their longtime doctors are familiar with, Novaria said. But these contract disputes and the related disruptions for patients happen frequently across the country, he said.
It’s sort of like a high-stakes poker game, Novaria said, “and the people who are used as chips are us, the patients.”
The current situation appears to be a replay of a similar dispute in 2003. Springfield Clinic’s board of directors initially decided that year to withdraw from Blue Cross’ PPO plan because of what the clinic considered low reimbursement rates for services. The board then changed its mind three months later and rejoined the PPO.
Memorial Medical Center and its network of doctors made the same initial decision at the time. The SJ-R reported that Memorial officials said a drop in patients associated with the decision to leave the PPO contributed to 42 layoffs among the hospital’s workforce. Memorial then rejoined the PPO.