Updated: Hendrick Chooses to Leave Blue Cross Blue Shield Network

Updated: Hendrick Chooses to Leave Blue Cross Blue Shield Network

According to Hendrick, a decision has been made that affects around 10,000 households--Blue Cross Blue Shield estimates around 75,000 local members--after Hendrick Health System chose to leave the Blue Cross Blue Shield of Texas network after a decision could not be made between the two concerning medical reimbursement rates by the midnight deadline on June 30.
Updated Story

According to Hendrick, a decision has been made that affects around 10,000 households--Blue Cross Blue Shield estimates around 75,000 members across the Big Country, with about 35,000 of those in Taylor County--after Hendrick Health System chose to leave the Blue Cross Blue Shield of Texas network after a decision could not be made between the two concerning medical reimbursement rates by the midnight deadline on June 30. This means, as of Tuesday morning, July 1st, Hendrick physicians are now considered out-of-network for all BCBSTX members.

The two have been in a debate for several months now over medical reimbursement rates.

A representative from the BCBSTX says Hendrick was asking for a 40 percent rate increase, but a Hendrick spokesperson said it's normal for hospitals to request an increase, as the cost of health care rises.

BCBSTX members may click here for a video and to find information on what to do now, how to find access to local care, and for answers to common question.

In response to Monday night's decision, BCBSTX has provided the following release:

As of July 1, Hendrick Health System (Hendrick) has left the Blue Cross and Blue Shield of Texas (BCBSTX) BlueChoice® PPO/POS network. Over the last several months, BCBSTX has been engaged in discussions with Hendrick in an effort to reach an agreement that would provide affordable health care options for Blue Cross members in the Abilene area.


“We are disappointed that Hendrick has chosen to no longer accept our members as ‘in network.’ We are fully committed to minimizing any inconvenience this causes our members in the Abilene community,” said Dr. Dan McCoy, BCBSTX chief medical officer. “We understand that our members may have concerns and questions about these changes. I want to assure them that our priority is to help them experience as little inconvenience as possible as they change to other health care providers in our networks.”


BCBSTX members with questions or concerns can call the customer service number on the back of their member ID cards. Members can also visit www.BCBSTX.com/hendrick for more information and a list of other area hospitals in the BCBSTX network.


“Hendrick Health System has rejected a fair and reasonable rate increase. We have a commitment to our employer groups and members to provide access to quality, affordable health care benefits,” said Dr. McCoy. “Hendrick requested a 40 percent increase in their reimbursement rate for the same volume of services and level of care they currently offer our members. This is the equivalent of 27 times the current rate of inflation. If we were to give Hendrick the additional amount they demanded, it would have added millions of dollars annually to the costs of our members. This is something we could not agree to do.”


For more than 80 years, BCBSTX has provided its members with helpful ways to improve and maintain their health and wellness. BCBSTX is committed to the communities it serves, and proud to be a major employer in Abilene with more than 1,200 team members. Through partnerships with Big Brothers Big Sisters Abilene, Food Bank of Abilene, March of Dimes and many others, the company has been able to contribute to Abilene’s greater community. Recently the Abilene Chamber of Commerce awarded BCBSTX the 2014 Corporate Star Award in recognition of going above and beyond for the Abilene community.



Hendrick Health System has also provided a response which may be read below:

After more than 11 months of negotiations, Hendrick Health System, as well as Hendrick Provider Network and Hendrick Anesthesia Network physicians, are no longer part of the Blue Cross Blue Shield of Texas network, effective July 1.


“We are very disappointed that we have been unable to reach an agreement,” said Tim Lancaster, president and CEO of Hendrick Health System. “Unfortunately, BCBS was unwilling to compromise and chose to let the contract end. This is certainly not the outcome we wanted, but we remain fully committed to working with our patients to continue providing the care they need. It is necessary for our hospital to only work with insurance providers that recognize the value of our services and the quality healthcare we provide to our community”


Patients with BCBS commercial insurance can continue to access Hendrick services and physicians, but may face higher out-of-pocket costs, dependent upon their specific plan and out-of-network benefits.


Residents covered by Blue Cross Blue Shield who have questions about their options can call

(325) 307-0368 or visit www.ehendrick.org/bcbs to find a list of frequently asked questions.


“We know this situation can be stressful, and we are here to help,” said Lancaster “We appreciate your patience and support during this time, and we will continue to pursue a resolution that will allow BCBS members to continue to access Hendrick on an in-network basis.”



Original Story


Monday, June 30 is the final day for negotiations between Hendrick Medical Center and Blue Cross Blue Shield Texas (BCBSTX) regarding reimbursement rates. If an agreement is not made by midnight, then Hendrick physicians will be considered out-of-network for BCBSTX members.

BCBSTX representatives state that Hendrick is asking for a 40 percent rate increase; however, Hendrick has responded by saying it is normal for hospitals to ask for rate increases as the cost of health care goes up.

It is estimated that this agreement, or the failure to reach one, will impact around 10,000 people. 

Below are press releases from both Hendrick and Blue Cross Blue Shield Texas explaining each side's concerns. A link to a video news release from Blue Cross Blue Shield has been provided and may be viewed by clicking here. Information on what Blue Cross Blue Shield members should do should an agreement not be reached by June 30 can be found here.

The following is a news release sent by Hendrick Medical Center regarding ongoing negotiations between Blue Cross Blue Shield Texas.

Hendrick Medical Center (HMC) has been in negotiations with Blue Cross Blue Shield Texas (BCBSTX) for more than 10 months to reach an agreement in existing contracts. If an agreement can’t be met by June 30, Hendrick services, as well as Hendrick Provider Network (HPN) and Hendrick Anesthesia Network (HAN) physicians, will be considered out-of-network for BCBSTX patients.


“It’s important to know that, for now, nothing changes,” said Tim Lancaster, president and CEO of Hendrick Medical Center. “We remain committed to working with BCBSTX in good faith to reach a fair agreement. Our goal is to ensure that the community has uninterrupted access to our facilities and physicians.”


Despite the 60-year relationship between HMC and the insurance carrier, BCBSTX has created a large gap between Hendrick contract rates and fair market value. The last hospital payment rate increase was four years ago.


“Fair payments from insurance companies are critical in allowing us the ability to improve access to care for our community, reinvest in medical technology and recruit and retain the highest quality physicians, nurses and medical staff,” said Lancaster. “We want to reach a fair agreement with BCBSTX to protect our patients’ access to quality, cost effective and convenient healthcare services.”


Hendrick is currently notifying area employers and patients of its negotiation status. A patient hotline, as well as an informational webpage has been set up to help patients with some frequently asked questions. Patients can call (325) 307-0368 or visit www.ehendrick.org/bcbs.


Below is a release sent out by Blue Cross Blue Shield regarding the negotiations:

Over the last several months, Blue Cross and Blue Shield of Texas has been in good-faith negotiations with Hendrick Health System (Hendrick) in an effort to reach an agreement that would provide affordable health care options for Blue Cross members in Abilene. Unless a mutually acceptable agreement is reached, Hendrick will no longer be part of the BCBSTX BlueChoice® PPO/POS network effective July 1, 2014 and Traditional/Par Plan Aug. 5, 2014.


“We have a commitment to our employer groups and members to provide access to quality, affordable health care benefits,” said Dr. McCoy, BCBSTX chief medical officer. “Hendrick is demanding a 40 percent increase to the rates we currently pay for the same amount and quality of services that they provide right now. This would add millions of dollars annually to our members’ costs and is the equivalent of 27 times the current rate of inflation. This is something we simply cannot agree to do.”


BCBSTX’s goal throughout the negotiation process has been to achieve a reasonable outcome that will allow the company to meet its employers’ and members’ expectations that it manage medical cost increases and maintain equity among providers in the area.


“We’re hopeful that Hendrick will rethink their position and work with us to reach an agreement that keeps costs down across the health system,” said Dr. McCoy. “We have offered Hendrick a fair and reasonable reimbursement rate.”


While BCBSTX is working hard to reach resolution with Hendrick, Blue Cross and Blue Shield of Texas members can rest assured that either way, they will continue to have access to a wide range of quality, affordable doctors and hospitals.


This issue does not impact any care BCBSTX members receive from now until June 30, 2014. They can continue to access care with Hendrick facilities and physicians in the same way they have in the past.


BCBSTX members with questions or concerns can call the customer service number on the back of their member ID cards.


BCBSTX employs more than 1,200 in Abilene, and recently the Abilene Chamber of Commerce awarded BCBSTX the 2014 Corporate Star Award in recognition of going above and beyond for the Abilene community.




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