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Children’s Minnesota is ending its contract with Blue Cross and Blue Shield of Minnesota, effective July 5, 2017.

Children’s Minnesota is notifying families with children insured through Blue Cross and Blue Shield of Minnesota and Blue Plus (Blue Cross), including Blue Advantage PMAP, that Children’s is ending its contract with Blue Cross.

Nobody takes better care of kids – all kids, including our very sickest. That’s our mission and we will fight to fulfill it, even when it means making difficult decisions like this. While our formal contract with Blue Cross expired at the end of last year, for the last six months we have tried to negotiate a new contract. Unfortunately Blue Cross remains insistent in its demand for a double digit reduction in payments for the care of families using Blue Cross’s medical assistance product. Such a drastic payment reduction will hinder our ability to provide the full range of services children depend on, and to remain accessible to all who need our care as the region’s largest pediatric health care system.

Unless a new agreement is reached, Children’s will become an out-of-network provider for Blue Cross members as early as July 5, 2017, or if Blue Cross chooses to extend the current contract, December 31, 2017.

Answers to commonly asked questions

Q.     Why is Children’s ending its contract with Blue Cross and Blue Shield of Minnesota and Blue Plus (Blue Cross)?
A.    We have made the difficult decision to terminate our contract with Blue Cross after more than six months of negotiations where no meaningful progress was made. We are ending our contract because the reimbursement rates offered to us by Blue Cross do not provide reasonable payment for the care we provide. Specifically, Blue Cross is demanding an exceptionally large double-digit reduction in payments that Children’s receives to provide care for patients insured through Medicaid. On average, Children’s currently receives from payers about 70 cents for every dollar of cost actually incurred to provide care for patients insured through Medicaid. In 2016, Children’s treated more than 70,000 Minnesota children covered by Medicaid. With payment rates that are already well below our cost to provide care, the massive reductions demanded by Blue Cross would be devastating to Children’s and impact care provided to all patients.

Q.     Are all Blue Cross plans affected?
A.     Children’s has one agreement with Blue Cross, so all who are insured through Blue Cross – including those on Medicaid and Commercial/Employer plans – are affected.

Q.    If I have Blue Cross coverage from another state or federal plan, am I also affected?
A.   In many cases, out of state Blue Cross coverage is a part of the Blue Cross MN agreement. Please contact Blue Cross to understand how your costs may change if our contractual relationship ends.

Q.     If I am a Blue Cross member, what does this mean for my child?
A.      This has no impact on visits or procedures scheduled through July 5, 2017. In addition, if Blue Cross chooses to extend the current contract this would move the effective termination date to December 31, 2017. Once the contract is terminated, it means Blue Cross enrollees will not have in-network access to Children’s hospitals, clinics and home care and we encourage families to carefully evaluate the impact of the termination and compare all available plans to ensure the best coverage to fit their needs.

Q.     Does this impact all of Children’s hospitals and clinics?
A.      Yes. Both Minneapolis and St. Paul Children’s hospitals, Children’s Special Care Nursery in Coon Rapids, 12 primary care clinics, all specialty clinics and six rehab sites across the Twin Cities, along with our Minnetonka Ambulatory Surgical Center and home care services would become out-of-network for all Blue Cross members. Please see additional information below regarding emergency situations.

Q.     Can I still use Children’s emergency room?
A.     Yes, emergency care is covered and you may continue to use Children’s emergency department. If you have Blue Cross commercial insurance, we suggest that you consult with a representative from Blue Cross to understand how your costs may change if our contractual relationship ends. If a family member is admitted to one of our hospitals through the emergency department, we suggest that you consult with a representative of Blue Cross to understand what services will be covered under your plan and your related out-of-pocket costs.

Q.     If I am scheduled to have a baby in The Mother Baby Center, will the contract termination affect me?
A.   If your newborn does not require specialized care, you should not be impacted. If your newborn requires specialized care at Children’s, we suggest that you consult with a representative of Blue Cross to understand what services will be covered under your benefit plan and any potential costs that you will be responsible for. At The Mother Baby Centers, Children’s provides specialized care for newborns born only in the specific areas listed below.

  • Minneapolis: The Mother Baby Center at Abbott Northwestern and Children’s Minnesota
    – Level IV Neonatal Intensive Care Unit (NICU)
    – Special Care Nursery
    – Infant Care Center
  • St. Paul: The Mother Baby Center at United and Children’s Minnesota
    – Level II/III Neonatal Intensive Care Unit (NICU)
  • Coon Rapids: The Mother Baby Center at Mercy with Children’s Minnesota
    – Special Care Nursery

Please note, the labor and delivery portion of your care in The Mother Baby Center is provided by Allina Health. Thus, your care coverage for labor and delivery would be determined between Allina Health and Blue Cross. Allina Health’s contract with Blue Cross is not impacted with this change.

Q.     How much more will I have to pay if my child continues to receive care at Children’s Minnesota after the contract ends (either July 5, 2017 or December 31, 2017)?
A.      Most health plans have different benefits and different payment provisions for out-of-network providers. Since your insurance benefit plan is unique to you, we suggest that you speak with a representative from Blue Cross to receive answers to specific questions you may have. If your child is currently receiving care from Children’s and provision of care extends beyond the contract end date, please consult with a representative from Blue Cross to receive answers about how long in-network provisions of your benefit plan will apply.

Q.     If my child’s current rehab or specialty care plan is expected to go beyond the contract end date will the services be covered by Blue Cross?
A.     If we are unable to reach an agreement, we suggest that you consult with a representative from Blue Cross to understand what services will be covered and what your out-of-pocket costs will be.

Q.     What other health plans that provide coverage for Medical Assistance members have contracts with Children’s?
A.      Children’s has contracts with UCare, HealthPartners and South Country Health Alliance. The Department of Human Services is considered an “in-network” provider with all of these health plans. A complete list of health plan options is available at this link.

Q.     If I have Blue Cross coverage from another state or federal plan, am I also affected?
A.      In many cases, out of state Blue Cross coverage is a part of the Blue Cross MN agreement. Please contact Blue Cross to understand how your costs may change if our contractual relationship ends.

What you need to know

Blue Cross members

More information for Blue Cross members who receive coverage through their employers can be found here.

Blue Advantage PMAP members

More information for Blue Advantage PMAP members insured through Medical Assistance or Minnesota Care can be found here.

Children’s news release

The news release announcing our decision to terminate our contract with Blue Cross can be found here.

Additional information

  • If you have general questions about this situation, we have set up a Children’s helpline at 952-992-5400 where a team is prepared to help you.
  • If you have specific questions about coverage or potential changes to your cost of care, we encourage you to contact Blue Cross customer service at 651-662-8000 or refer to phone numbers listed on the back of your membership insurance card.
Becky Sonka