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Johns Hopkins Medicine and CareFirst BlueCross BlueShield have reached an agreement for a new contract that keeps thousands of Hopkins providers within CareFirst’s network, ending a tense, weeks-long negotiation.
A joint statement Wednesday from the medical giant and the insurer said the multi-year contract ensures they can continue to serve members and patients with high-quality care. They did not disclose the financial terms of the agreement or specify how long the agreement lasts.
Pressure had been building on the two entities to come to terms. Earlier this month, Maryland’s Democratic Congressional delegation urged Hopkins and CareFirst to reach a deal ahead of the December deadline, noting that constituents’ health care access had come under threat on their watch.
“We continue to hear from many of our constituents with concerns that a breakdown in negotiations between Hopkins and CareFirst would greatly impede their access to primary and specialty care moving forward,” the delegation, led by U.S. Sen. Chris Van Hollen, wrote in a letter. “This resolution is vital for the health of our constituents in Maryland, and patients that rely on specialty care across the Mid-Atlantic region.”
At the center of the negotiations were the costs associated with the care patients receive for outpatient procedures and in ambulatory surgery centers, or those that don’t require an overnight stay, as well as doctor and other providers’ fees. That meant patients with CareFirst insurance who need routine visits with doctors and minor surgeries, such as lens and cataract procedures or endoscopies, would have had to pay out of pocket for those services. Hospital rates for inpatient services and procedures, meanwhile, are set by the state and are regulated; those rates were not up for negotiation.
As many as 300,000 Hopkins patients receive their insurance via CareFirst, said Kevin Sowers, president of the Johns Hopkins Health System and executive vice president of Johns Hopkins Medicine, in an interview with The Baltimore Banner last month. But not all would have been impacted if the negotiations fell through, he said. Patients with severe illnesses, such as cancer, and those enrolled in clinical trials would have continued to receive CareFirst coverage even without a deal by December.
Despite public backlash from members and federal officials, Sowers described the state of negotiations as “not a unique moment in the life of health care systems and payers.” The medical institution had no choice but to press for a new contract and end the prior agreement, he said, as it did not account for the rising costs of health care or what other insurers have agreed to pay.
“When we were looking at contracts, and benchmarking and comparing, we found there was significant difference in what we were receiving from CareFirst and payers like Cigna and UnitedHealthcare and Aetna. For providers’ fees, [CareFirst] was 40% below other payers on the market,” Sowers said last month. “When we looked at that and how we could keep Hopkins central to state and world, it became clear this wasn’t a sustainable model.”
He also said the cost to provide health care has gone up more than 21% in the last decade, but CareFirst’s payments to Johns Hopkins have gone up by just 10%. CareFirst, in an email, told The Banner that the terms of the current negotiation exceed an 11% increase, “and if 11% was acceptable, this renegotiation would be resolved.”
CareFirst, in its responses to Hopkins, said other, out-of-state providers have not always been accepted at the medical institution and that it offers the largest range of products and services in Maryland and Washington, D.C. It serves over 3.5 million members, according to its website, and provides access to 1.7 million U.S. health care providers.
Hopkins notified patients by mail last month of the potential changes to their coverage. Representatives from the two entities were not made available for comment Wednesday.
In a statement Wednesday, the state’s Democratic Congressional delegation thanked Hopkins and CareFirst for striking an agreement before Maryland’s health insurance open enrollment period, which begins Nov. 1.
hallie.miller@thebaltimorebanner.com
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Hallie Miller covers housing for The Baltimore Banner. She's previously covered city and regional services, business and health at both The Banner and The Baltimore Sun.
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