After emerging from a high-stakes showdown against the state's largest insurance provider, Tufts Medical Center officials remain tight-lipped about a deal expected to stave off widespread patient disruption.
Earlier this month, Tufts Medical Center Chief Executive Officer Ellen Zane, frustrated that her hospital was receiving substantially lower insurance payouts than its competitors, announced that the center would stop accepting Blue Cross Blue Shield as of Feb. 1 unless the company offered a better rate.
But several days later, on Jan. 17, the two sides ended the ensuing standoff. The medical center agreed to sign a Blue Cross contract, which correlates payments to hospitals with the level of care they provide. Previously, the center had refused to sign
the contract.
While Zane almost certainly won higher rates during the negotiations, neither Blue Cross nor the medical center would confirm the details. Both parties said they had come to a mutual agreement to keep the specific terms, apart from the signing of the contract, confidential.
"We agreed to confidentiality, as did they," medical center spokesperson Julie Jette told the Daily.
While the deal gave respite to frenzied patients who had been expecting to have to find either a different insurer or a new hospital, health care professionals say that it is only a bandage for a payout system deeply in need of more comprehensive treatment. "Nobody gets paid in Massachusetts — or other states for the most part — for keeping patients healthy," Brian Rosman, the research director for the Massachusetts organization Health Care for All, told the Daily.
Instead, mounting evidence shows that insurance providers reimburse hospitals for procedures on a sliding scale of influence, with the better rates going to treatment centers that have strong negotiating power.
"It's a free-market system where hospitals and health plans negotiate with each other with very little public oversight, and we think there needs to be much more transparency, particularly on the subject of payment," Rosman said.
Advocates for reform point in particular to rates that Blue Cross has given to Partners HealthCare facilities, which include Brigham and Women's and Massachusetts General Hospitals. The Boston Globe reported that before the new deal, Blue Cross was paying Tufts Medical Center 32 percent less than these two hospitals, both of which are
also affiliated with Harvard.
Over five years, Zane told the Globe, the medical center has lost $25 million from its involvement with Blue Cross. Meanwhile, Partners facilities have made out relatively well; Blue Cross pays Partners facilities $2 billion each year.
State officials have begun investigating this relationship, which critics say has led to excessive reimbursement for select hospitals.
State Sen. Pat Jehlen, who represents portions of Medford and Somerville, said she welcomes governmental probes into the relationship between Partners and Blue Cross.
"I think that we need to look at all the special deals," she told the Daily. "I would prefer to have [payouts] based on the quality of care [rather] than the negotiating power of the hospital."
The quality contract that the medical center signed seeks to do just that. Previously, officials there had refused to sign it, claiming that Blue Cross undervalued the level of care the center provided and that they needed more information about the substance of the contract.
Rosman, of Health Care for All, said he welcomes the spirit of the contract because it moves away from the current incentive structure that encourages hospitals to perform as many complicated procedures as possible to maximize reimbursements. "That's where the incentives all lie in terms of payouts," he said.
And where insurance companies pay more — either through special deals or to compensate for skyrocketing numbers of procedures — the costs get passed along to the consumers.
Still, Rosman suggested that the quality contract needs more sophisticated indicators of hospital performance.
But in the meantime, officials at the medical center and at Blue Cross appear relieved that — at least for the moment — the situation has quieted down.
"We have this deal [and] we're excited about it," Blue Cross Blue Shield of Massachusetts spokesperson Jay McQuaide told the Daily. "We're pleased that patients won't be in any disruption."
