Blue Cross, HCA in Partial Agreement

Blue Cross of California said late Tuesday that it reached a partial agreement with hospital operator HCA Inc. in a lingering contract dispute that has been disrupting care for patients in several California communities.

For weeks the health-care giants had been at loggerheads over how much Blue Cross will reimburse HCA for services at its six California hospitals. Contracts expired Oct. 1, leaving tens of thousands of Blue Cross members without coverage for most services at the hospitals, except for emergencies.

Late Tuesday, Blue Cross spokesman Michael Chee said negotiators meeting in Thousand Oaks had reached an agreement on a new contract for the three HCA hospitals in Southern California -- in Riverside, West Hills and Thousand Oaks. He said the two sides would return to the table today to talk about the three other hospitals, which are in San Jose.

Chee would not provide terms of the Southern California contract. HCA officials could not be reached late Tuesday.

Analysts viewed the contract dispute as another sign of the heightened tensions between insurers and hospital companies as they grapple with the pressures of rising health costs. Most expect such conflicts to intensify in the near future -- a menacing prospect for patients, who often are caught in the middle.

Blue Cross previously said it had offered HCA a 50% increase over two years, but an HCA spokesperson said Blue Cross payments were the lowest of all insurers and insufficient to cover the cost of medical services.

Many doctors have been clamoring about the Blue Cross-HCA fight, saying they have been forced to delay tests, postpone elective surgeries and divert patients to other hospitals.

“There’s compromise in care,” said Dr. Michael Papanicolaou. Tuesday, he and other doctors at Los Robles Regional Medical Center in Thousand Oaks reluctantly transferred a 60-year-old patient recovering from a head hemorrhage to a hospital about 20 miles away in Oxnard. “They’ll probably take good care of her,” he said, “but there won’t be any [doctor] there who knows her case.”

Besides Los Robles, the two other HCA acute-care hospitals in the Southland are West Hills Hospital and Medical Center and Riverside Community Hospital.

HCA, the nation’s largest hospital chain, this week reported a third-quarter profit of $200 million on revenue of $4.9 billion, even after big, one-time losses in the value of investment securities. The latest financial reports filed with California show that two of HCA’s hospitals in San Jose were losing money, but the rest are profitable.

Blue Cross of California is owned by WellPoint Health Networks, the biggest health insurer in California. WellPoint is expected to report its quarterly earnings today. The company, known for its aggressive rate negotiations with providers, has been one of the most profitable in the managed-care industry.