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KDMC safe in fight over insurance

An insurance dispute between a major Jackson healthcare provider and the state’s largest private insurer is an isolated fight that won’t affect Brookhaven’s hospital, its top executive said.

King’s Daughters Medical Center CEO Alvin Hoover said he does not anticipate a contract dispute with Blue Cross Blue Shield of Mississippi like the standoff the company is currently having with University of Mississippi Medical Center, a disagreement threatening to jack up costs for patients there. Hoover said the dispute is based on payments for specialized services KDMC does not provide, and the Brookhaven hospital does not have those conflicts.

“We’ll continue to have a contract with Blue Cross and continue to serve Blue Cross patients,” he said. “Any time a hospital is willing to cancel their Blue Cross contract, they’ve got some significant issues with how they’re getting paid. We have issues with Blue Cross and how they pay us, but it hasn’t risen to that level.”

The fight between UMMC and BCBS blew up last month when the Jackson hospital decided to end its contract with the insurer effective June 30. State insurance commissioner Mike Chaney has talked both sides into agreeing to contract mediation, and UMMC has agreed to continue treating BCBS patients as in-network patients for another month while the dispute is hashed out.

The dispute is based on payments UMMC receives for the sometimes rare and advanced services it provides in its capacity as the state’s only academic medical center. The hospital trains nurses and doctors under the umbrella of the University of Mississippi and provides several specialty services like transplants, a cancer center and several advanced research centers.

UMMC wants non-negotiable rates that respect its unique role, but BCBS says the hospital is uncooperative. If the two sides can’t reconcile, UMMC could leave the BCBS network, resulting in higher charges and out-of-pocket costs for BCBS patients treated there.

“The academic medical centers really do have a tough financial environment to live in,” Hoover said. “For the type of cases that go up there, they’re high-cost procedures, and they don’t necessarily have a lot of volume in those cases to make up for the low margins they carry.”

It’s a different world in Brookhaven, where KDMC focuses on community services like labor and delivery, rehabilitation, wound care, pediatrics and numerous other family-centered services.

“We don’t have to train medical residents. I don’t have the number of specialists they do,” Hoover said. “We have the services that generally take care of our community, and for anything we don’t have, that’s why we have a helicopter to take people where they need to be.”