Empire BlueCross and Hospital Alliance at Impasse

Posted on 30 October 2009

The quiet period that had been exercised between insurer Empire BlueCross BlueShield and the three hospitals of the East End Health Alliance expired in the past two weeks as negotiations between the two parties have reached an impasse.

The Alliance took the opportunity recently to post on its website a message that argues, repeatedly, “Empire puts profits over patients.”

For their part, Empire posted on its website on October 12 an update that claims the Alliance is seeking an increase in reimbursements that is “unnecessary and would result in an immediate jump in health care costs on Long Island.”

The insurance company — which represents more clients on the East End than any other provider — and the local hospitals, including Southampton Hospital. Eastern Long Island Hospital and Peconic Bay Medical Center, have been at odds since this past summer, when negotiations first broke down at the time the agreement between them expired, and patients with Empire coverage were no longer covered by the hospitals. Since then Empire has made some concessions, and certain senior patients and those living within certain local zip codes, who live beyond 30 miles from another participating Empire Hospital (ie. Brookhaven or Stony Brook) would be covered at the Alliance hospitals.

In a posting on their website, Empire claims one reason the sides have not reached an agreement is that the Alliance is demanding an increase of over 60 percent over a 21 month period, adding the reimbursement rate would be greater than the reimbursement given to other similar hospitals in the state. The company says it has offered the Alliance several proposals, including the most recent a multi-year agreement with a “substantial” rate increase and a one time payment allowing the hospitals to invest in programs and operational changes which, it claims, would make the hospitals more efficient.

The Alliance argues that its hospitals are “among the most cost effective in the state”

“But Empire pays us less than it costs to treat you and your family when you need us — and significantly less than every other managed care insurance company we deal with,” read a post on the Alliance website.

What happens next?

“We’ve put reasonable proposals in front of them,” said Craig Andrews, an Empire spokesperson. “We’ve left it in their court.”

 “Empire BlueCross BlueShield remains willing to agree to a new, multi-year contract with substantial increases for EEHA hospitals, despite the difficult economy we all face,” said the insurer. “But there is a point where reason, and the hospitals obligation to manage their operations more effectively, must become a priority. The cost of health care is everyone’s responsibility, including EEHA hospitals.”

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One Response to “Empire BlueCross and Hospital Alliance at Impasse”

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