Still at an impasse with Blue Cross, CHI St. Vincent CMO argues for fairness and healthy competition

Since the beginning of the month, customers of Blue Cross Blue Shield, the state’s largest insurer, have been locked out of network at CHI St. Vincent as the hospital continues its battle for higher reimbursement rates.

The impasse over these rates has direct, real-world consequences for your friends and neighbors, and maybe even for you. Who among doesn’t have friends asking around for doctor recommendations now that their usual go-to provider is no longer in their health insurance network?

While the word on the street is that the gap between what St. Vincent wants to be paid for services and the amount Blue Cross Blue Shield wants to pay may never be bridged, CHI St. Vincent Chief Marketing Officer David Griffin said resolution is still possible.

He sent out a letter to the editor Monday to make his case. Here it is.

A fair contract is about more than CHI St. Vincent. It’s about whether Little Rock keeps two strong hospital systems.

Since September 1, tens of thousands of Arkansans with Arkansas Blue Cross and Blue Shield coverage have been out of network at CHI St. Vincent’s four hospitals, 80 clinics and more than 300 physicians and providers. The public has heard that CHI “opted out.” That framing deserves a closer look.

Federal price transparency rules now let anyone compare what insurers pay hospitals. Those files show Arkansas Blue Cross pays CHI St. Vincent substantially less than it pays Baptist Health for comparable services, a few miles away. CHI St. Vincent did not ask to be paid more than Baptist. It asked to close part of that gap. Blue Cross declined to agree to terms that provided similar reimbursement for the same care.

This is why that matters to patients, not just accountants: a hospital’s reimbursement is its budget for nurses, cardiologists, surgeons, imaging equipment, cath labs and the technology that separates good care from great care. Every Arkansas hospital recruits from the same national pool of physicians and nurses, and competes with Texas, Tennessee and Missouri for them. When one Little Rock system is paid meaningfully less than its crosstown competitor for the same work, it cannot match that competitor’s salaries, equipment or facilities indefinitely. Over time, the gap becomes a quality gap. Then patients notice, and by then it is very hard to reverse.

Arkansas Blue Cross is the state’s dominant insurer, and its market share gives it enormous leverage. It has said its last offer is as far as it is prepared to go. CHI St. Vincent has said publicly it has not walked away and wants a new agreement quickly. Only one side is describing the door as closed.

There is also a timing question worth asking. Arkansas Blue Cross’s affiliation with Portland-based Cambia Health Solutions takes effect October 1. Whatever its merits, that transaction means contracting decisions in Arkansas will increasingly follow a six-state playbook. Arkansans should ask whether a rate freeze on one of our largest hospital systems is being driven by local needs or by the numbers that look best going into that deal.

Central Arkansas benefits from having two strong, competing health systems. Nobody, including Baptist Health, is better off if one of them is slowly starved. Blue Cross members and the employers who pay the premiums should ask a simple question: if the insurer can afford to pay Baptist the current rate, why is a somewhat lower rate for CHI St. Vincent unaffordable?

CHI St. Vincent has cared for Arkansans since 1888. It is asking for a contract that lets it keep doing so at the level its patients expect. That is not an unreasonable request.