BCBS of Texas, Memorial Hermann near new contract deadline

BlueCross BlueShield of Texas has until Feb. 28 to strike up a new network agreement with Houston-based Memorial Hermann Health System, according to Click2Houston

In November 2021, the health system notified BlueCross BlueShield of Texas of its intent to terminate its contract, Mark Chassay, MD, the payer's CMO, said in a video statement

Should the parties fail to reach an agreement by Feb. 28, Memorial Hermann will be out of network effective March 1. The move would affect over 3,000 health system physicians and more than 265 locations. 

James McCarthy, MD, Memorial Hermann chief physician executive, told Click2Houston that the payer is offering a small number of physicians an accountable care organization agreement while coercing the rest of the system's physicians into ACOs that BlueCross BlueShield of Texas owns through higher rates.

According to the health system's websites, the parties are also clashing over reimbursement rates.

"BCBSTX incorrectly asserts that Memorial Hermann’s requests for higher rate increases are unreasonable," Memorial Hermann said on its website. "This is surprising given that Memorial Hermann and BCBSTX successfully negotiated agreements with agreed upon rates less than two years ago, and the current request for a modest increase is lower than many premium increases quoted to our community employers."

BlueCross BlueShield of Texas said it was offering physicians the opportunity to contract with it directly, but was hopeful that the parties "will reach a mutually beneficial agreement."

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