Blue Cross of Okla.'s rate cuts would be 'another nail in the coffin of rural hospitals,' one says

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Blue Cross Blue Shield of Oklahoma wants deep rate cuts that some rural hospitals say they can't afford. If the hospitals can't comply with the insurance company's demands, hospital officials say they can't remain in-network. "Don Buchanan, CEO of
Haskell County Community Hospital in Stigler, said BCBS intends to cut the hospital's reimbursements by 30 percent for all services, except those in the emergency room. The current contract runs out Oct. 31, and if BCBS doesn't change its intention by then, the hospital will have to stop taking that form of insurance, he said," Meg Wingerter reports for The Oklahoman.

BCBS wouldn't discuss the specifics, but told The Oklahoman that it makes "every effort" to keep insurance affordable and accessible while providing "fair and equitable reimbursements." If a hospital leaves the network, insured members can search for other options on the BCBS website. The trouble with that is two-fold for rural residents: going to an out-of-network hospital is usually much more expensive, and traveling long distances for medical care is difficult. Haskell County has only one hospital, so patients might have to drive 50 miles to find an in-network hospital. Buchanan said that many of the 6 percent of the county's patients with BCBS insurance are older and would have a hard time driving that far. It would also be a problem for women delivering babies.

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At Drumright Regional Hospital, CEO Tracy Byers says the proposed cuts range from 30 to 40 percent. About 15 percent of the hospital's patients have BCBS insurance, so he says the rate cut would cost the hospital $1 million every year. The hospital can't afford to offer services at a loss, and may stop accepting BCBS insurance.

Mike Murtha, president of the National Alliance for Rural Hospitals, said rural hospitals are already struggling, and the BCBS cuts could cause some to close. "Losing a hospital would have repercussions for the surrounding community, because businesses won't want to set up in a town without a hospital nearby, Murtha said. If BCBS doesn't change its intention, the alliance will start working on suggested regulations to protect rural hospitals, such as mandatory minimum payments, he said," Wingerter reports.

Buchanan said his hospital will keep negotiating with BCBS until the last second. If the cuts are enforced, he says "It's just another nail in the coffin of rural hospitals."