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Update on Blue Cross Blue Shield Texas Contract Negotiations

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HOUSTON (December 17, 2020)  St. Luke's Health (St. Luke's) announced that its contract with Blue Cross Blue Shield of Texas (BCBSTX) expired at 11:59 pm on December 16. This comes after months of efforts by St. Luke's to get BCBSTX to agree to reasonable rates that would allow the health system to remain financially sustainable.

Despite these multiple efforts and multiple proposals by St. Luke's Health, BCBSTX would not agree to rates that allow for St. Luke's financial viability. The following is a statement from St. Luke's CEO Doug Lawson regarding the termination:

"We're terribly disappointed at BCBSTX's continued unwillingness to offer rates that simply provide financial sustainability for the care we provide. At a time when our frontline health system employees and care-givers are risking their lives to care for the health of our community, BCBSTX is prioritizing profit over people. Their inaction and inability to compromise is further reducing choice, access to essential services, and life-sustaining care at a time when our community needs it more than ever. The increase that we sought wouldn't significantly change the bottom line for BCBSTX, but for our health system it would mean financial stability and the opportunity to invest in the people and resources that are so desperately needed at this moment."

St. Luke's is a not-for-profit, faith-based hospital system. One hundred percent of the money it receives is funneled back into its people, facilities, and communities, as well as ensuring it has the best technology available.

As a not-for-profit, St. Luke's must act as careful stewards of its finances. Unlike BCBSTX, which has a multibillion-dollar annual profit, St. Luke's does not have similar corporate resources to safeguard operations. Following years of underpayment from BCBSTX, the current proposal would simply move St. Luke's from the bottom-tier of BCBSTX reimbursements into the middle.

St. Luke's is open to continued negotiations with BCBSTX.

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