What are hospital systems supposed to do if insurers refuse to play fair?
As of February 1, Blue Cross Blue Shield of Arizona (BCBSAZ) is out of network with San Francisco-based Dignity Health’s Arizona locations.
The reason for the split?
None other than reimbursement rates.
Dignity Health said in a statement that its physicians and hospitals “rely on fair contracts to help us cover normal increases in the cost of providing high-quality care.”
Dr. Anthony Torres, the CEO of Yavapai Regional Medical Center within the Dignity Health hospital network, said the non-profit hospital was asking for an increase that was under the rate of inflation for its costs, which are higher than average because it takes more money to recruit and retain doctors in the rural area.
Dr. Torres isn’t wrong. An increasing number of doctors prefer larger, metropolitan regions, which inherently disadvantages rural areas by limiting the pool of candidates available for recruitment, according to the New England Journal of Medicine Career Center.
What’s worse, Dignity Health reports that BCBSAZ is refusing to pay millions of dollars in outstanding claims — meaning that doctors have already provided this care to patients and are not being reimbursed for it.
This is yet another example of insurers playing hardball. It’s also an example of insurers’ blatant disregard for the plight of hospitals. Due to record-setting inflation and a challenging recruitment environment for rural hospitals, operating expenses have significantly increased for health systems like Dignity Health — and others nationwide. Now more than ever, reimbursement is crucial as it guarantees that providers receive payment for the services they render, enabling them to continue providing healthcare services to patients.
