MultiCare, which operates more than a dozen hospitals in Washington, has agreed to keep charging Premera Blue Cross insurance customers in-network rates after months of negotiations that threatened their coverage.
The hospital system and insurer are still hashing out the details, Bill Akers, executive vice president of sales and marketing for Premera, said Tuesday. Both parties declined to provide further information about the preliminary agreement.
“We appreciate the patience of our members and customers, and the work both organizations invested to reach this point,” Akers said in a statement. “We’ll share more when the contract is finalized and look forward to continuing our relationship with MultiCare and serving our communities together.”
A MultiCare spokesperson confirmed the deal.
“We value our longstanding partnership with Premera and are pleased to continue providing high-quality, locally accessible care to the communities we serve,” spokesperson Scott Thompson said in an email Tuesday.
Earlier in the contract talks, Premera had to notify roughly 100,000 households that MultiCare services may result in out-of-network costs for patients. Over 16,000 get insurance through the School Employee Benefits Board, or SEBB, for example. In the past couple years, about 163,000 people with Premera coverage have had claims in the MultiCare system, the insurer has said.
Based in Tacoma, MultiCare operates 13 hospitals and many other primary care and urgent care clinics. This includes Yakima Memorial Hospital, Tacoma General Hospital and Capital Medical Center in Olympia. While Overlake Medical Center in Bellevue is part of that system, it isn’t subject to the agreement that was subject to negotiations, so patients there would be covered either way.
These negotiations with providers usually come every two or three years, mostly over how much insurers will pay hospitals for caring for policyholders.
This was the main sticking point here, as hospitals brace for cuts to Medicaid and more uninsured patients that could hurt their bottom line. MultiCare had said Premera’s reimbursement rates are “among the lowest” compared to other insurers. Hospitals are already dealing with rapidly rising costs outpacing inflation.
On the other side, the Mountlake Terrace-based insurer saw this as an affordability issue, with increased reimbursements potentially trickling down, contributing to higher premiums for enrollees and added costs for employers.
“Throughout these discussions, Premera’s focus has been protecting access to care while helping keep healthcare affordable,” Akers said.
Premera said earlier MultiCare proposals would result in thousands of dollars in added costs for routine procedures. For example, $17,000 more for a knee replacement.
As the contract talks dragged on, MultiCare and Premera, which are both nonprofits, had to extend a previous contract multiple times to ensure it didn’t lapse, which would have meant patients with Premera insurance would have had to pay out-of-network costs. An earlier deadline would’ve allowed the agreement to end starting in June. The current cutoff is the end of this month. The negotiations had been ongoing since November.
There still would’ve been exceptions even if the agreement ran out. Emergency care is covered in-network under federal law. Premera customers with Medicare Supplement plans wouldn’t have been affected. And a 60-day grace period under state law would’ve allowed patients to remain in-network after notice of a contract termination.
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