The largest nonprofit health system in Texas and the state’s most prolific insurer are locked in a contract dispute that could affect care for thousands of people in Central Texas and beyond.
Blue Cross Blue Shield of Texas (BCBSTX) said it received a notice from Baylor Scott and White Health (BSWH) in May announcing that it would terminate its physician and hospital agreements with BCBSTX unless a new contract is achieved by July 1. The hospital system and the insurer are in the process of negotiating reimbursement rates for health care costs between BCBSTX and BSWH providers.
BSWH has notified patients covered by BCBSTX insurance that they will be considered out-of-network at BSWH facilities after July 1 if the two parties can’t reach an agreement.
“Our patients are our priority, and we’re continuing to negotiate in good faith to prevent any disruption,” a BSWH spokesperson said in an emailed statement.
BSWH operates 51 hospitals and more than 800 patient care sites throughout Texas, including Baylor Scott & White Medical Center Austin, as well as hospitals in Buda, Lakeway, Marble Falls, Pflugerville, Round Rock and Taylor. It also operates several clinics in Central Texas.
BCBSTX has about a quarter of the market share among Texas health insurers, according to the Texas Department of Insurance.
“We’re working closely with BSW leadership and hope to sign new contracts before July 1,” BCBSTX said in a statement on its website. “We value our relationship with BSW, but it’s also important that the contracts we agree to are fair for our members and the local businesses we serve.”
BCBSTX has had down-to-the-wire negotiations over reimbursement rates with several other health care providers in recent years. In early 2023, BCBSTX struck a deal with Ascension days before a deadline. It has also come to last-minute deals with UT Southwestern Medical Center and Texas Health Resources.
If BCBSTX and BSWH do not come to terms, Blue Cross-insured patients will see increased out-of-pocket costs if they wish to continue seeing BSWH providers. BSWH said patients who are receiving an active course of treatment may qualify for “Continuity of Care” benefits through BCBSTX and should contact their insurance provider to apply.
Disclosure: KUT receives benefits through the University of Texas’ Blue Cross plans.
