BCBST customers no longer covered at Methodist Le Bonheur Health facilities; contract negotiations gone sour

MEMPHIS, Tenn. (WMC) - The new year brings new beginnings for many, but for Blue Cross Blue Shield of Tennessee (BCBST) customers it’s the beginning of not being covered under the Methodist Le Bonheur Healthcare (MLH) network.

After over a month of back-and-forth in hopes of negotiating a new contract, the two institutions failed to do so by the Dec. 31 deadline.

Now, thousands will have to find care at another Memphis facility or be forced to pay for MLH services out of pocket.

“Methodist Le Bonheur Healthcare negotiated in good faith, offering a number of concessions, including deep discounts on our current rates and to extend current contracts with BCBST to minimize any disruption in care for patients,” an MLH spokesperson told Action News 5. “Yet, BCBST continues to make unreasonable demands and refuses our offers.”

As BCBST told us, specifically in the case of Le Bonheur Children’s Hospital, BCBST customers make up “over 50% of the commercial insured volume at Le Bonheur Children’s Hospital, but we only get a 21% aggregate discount from their standard rates.”

Customers with different insurance companies, according to BCBST, receive “almost a 41% discount” from their rates.

“Our Methodist Le Bonheur Healthcare system rates were significantly higher than our average rates for other facilities in the Memphis area – and in the case of Methodist Le Bonheur Children’s Hospital, their rates were the highest of any children’s hospital in Tennessee by far,” said a BCBST spokesperson. “For the majority of these facilities, we offered Methodist Le Bonheur Healthcare new contracts with lower, fair-market rates that would enable us to lower premiums significantly for BlueCross members.”

This fallout, however, does not impact the entire MLH network.

We’re told by MLH that MLH physician groups and emergency care services are not impacted by these negotiations and are still considered in-network.

Check with you MLH physician and with BCBST to confirm.

Both MLH and BCBST say they will continue negotiations in hopes of reaching a new deal, but in the meantime MLH services will not be covered under the BCBST umbrella.

We were told a separate contract was offered to include only Le Bonheur Children’s Hospital while negotiations for the entire network continued, but this contract ultimately fell through.

MLH says they offered a six-month extension to the current contract in order to continue negotiations and also allow patients to continue being covered, but this also did not pan out.

The insurance is still accepted at all other Memphis hospital networks: Baptist, Regional One, St. Francis, and Sanitas.

The following are MLH facilities that have been removed from BlueCross networks, including Blue Network, BlueCare Tennessee, TennCare Select, CoverKids, and the Dual Special Needs Plan (D-SNP).

The facilities listed by BCBST are:

• Methodist University Hospital
• Methodist Healthcare – Germantown
• Methodist Healthcare – North Hospital
• Methodist Healthcare – Olive Branch Hospital
• Methodist Healthcare – South Hospital
• Methodist Blood and Marrow Transplant Center
• Methodist Comprehensive Breast Center – Germantown and Midtown locations
• Methodist Le Bonheur Children’s Hospital
• Methodist Le Bonheur Germantown
• Methodist Le Bonheur Germantown Surgery Center
• Wolf River Surgery Center (effective Oct. 23, 2023)
• Methodist Alliance Home Care Services
• Methodist Alliance Home Medical Equipment
• Methodist Healthcare Minor Medical Center (Cordova, Hacks Cross, Midtown Memphis, Olive Branch)
• Methodist Alliance Hospice (effective Oct. 31, 2023)

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