Negotiations are continuing, and an extension or a deal remains possible even after the deadline, officials said. Each side says the other is not responding to overtures.
Talks about new rates began about 10 months ago because rates have been unchanged since 2003, said Frank Smith, the chief operating officer for the group that represents the health system’s physicians. Blue Cross said in a statement that the health system’s doctors have received “higher than market rates” for more than nine years. MCG health system wants 13 percent, or about 1.4 percent per year over the nine years, Smith said. Blue Cross countered with 3 percent.
“They started the negotiations saying they would offer us 3 percent, and for nine months they’ve been on 3 percent,” he said. After a couple of months, the health system set an initial termination date for the contract in January but has extended it four times in hopes of reaching a deal, Smith said.
“We finally got to the point where we told them we weren’t going to extend any longer,” he said. “They’ve not moved off their initial position in nine months, and we have.”
Blue Cross countered that it has “made multiple proposals that have moved the parties closer together” and that its attempts to reach senior leadership “remain unanswered.”
If the health system does terminate with Blue Cross, it will come at a stiff price. Blue Cross represents about 10 percent of its business, $60 million to $70 million, Smith said.
Both sides said that they are open to more talks and that negotiations will likely continue.
“If they came with something that we thought was a reasonable attempt to try to resolve the differences, we’re certainly open to talking,” Smith said. “I expect we will be talking right up through the deadline of Aug. 15 and even beyond that.”