Blue Cross and Blue Shield of Illinois has decided it won't allow hospitals and health systems that have affiliated but not fully merged to jointly negotiate payment rates, according to a Crain's Chicago Business report.
Blue Cross spokesman Mike Deering issued a statement indicating that while the health insurer supports clinical affiliation and integration to improve quality of care and contain costs, Blue Cross — the state's dominant health insurer — doesn't feel joint rate negotiation is necessary to achieve those benefits, according to the report. The insurer will negotiate rates only with healthcare organizations under common ownership.
The decision comes in response to a clinical affiliation agreement Silver Cross Hospital in New Lenox, Ill., and Downers Grove, Ill.-based Advocate Health Care announced earlier this year. Despite Silver Cross' clinical integration with Advocate's physician-led care management group, Advocate Physician Partners, under the deal, the partnership wasn't a merger or acquisition. Silver Cross and Advocate had planned to jointly negotiate rates with Blue Cross, with the independent hospital gaining leverage through its affiliation with the 12-hospital Advocate, according to the report.
Advocate CEO Jim Skogsbergh told Crain's Blue Cross' decision would have "a chilling effect" on non-merger relationships between healthcare providers.