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Blue Shield, UCLA break impasse over pay

Blue Shield and UCLA, the operator of two Westside medical centers, remain far apart on pay for treatment. But a proposal on the table offers some hope to Blue Shield members trapped in the middle.

March 20, 2012|David Lazarus

After months of impasse, Blue Shield of California and UCLA finally have a proposal on the table to settle a contract dispute that's caused worry and confusion for thousands of patients seeking treatment at one of the state's premier medical facilities.

But don't expect a breakthrough any time soon. The two sides remain far apart over how much Blue Shield should pay for members' visits to Ronald Reagan UCLA Medical Center in Westwood and the nearby Santa Monica-UCLA Medical Center and Orthopaedic Hospital.

"At last we can legitimately negotiate," said Steve Shivinsky, a Blue Shield spokesman. "But there's a long road ahead."

UCLA and Blue Shield have been squabbling since fall over reimbursement rates. More than 200,000 Blue Shield customers live within 15 miles of the campus' Westside medical centers.

Since the insurer cut its ties with UCLA, Blue Shield members seeking treatment at the hospitals have had to plead for "continuation of care" authorization, which Blue Shield is allowing on only a case-by-case basis.

All those denied such approval have to seek medical care elsewhere, unless they're willing to pay all expenses out of pocket to see their usual doctor.

Two of those stuck in the middle are Rick Perl, 58, and his 23-year-old son, Ryan, who was diagnosed with a walnut-size brain tumor at age 5 and has been living with assorted medical complications ever since.

Ryan has been seeing doctors at UCLA since his family moved to Oxnard from the Midwest about a year and a half ago.

"It's the only place between Mexico and San Francisco where they're qualified to offer the level of care that Ryan needs," Perl told me.

But just as he and his son were heading out the door in January for Ryan's latest checkup, they received a call from the medical center informing them that, because of the tussle between UCLA and Blue Shield, Perl would be responsible for 100% of any costs.

That wasn't a feasible option. Luckily, Perl was told by Blue Shield that his son had been granted an automatic 90-day continuation of care authorization, so it was just a matter of getting the appropriate paperwork faxed to UCLA.

The authorization expires next month, and Perl said he wasn't sure what happens next.

"I'm working on getting an additional continuation of care," he said, "but I can't say for sure what will happen."

Blue Shield's Shivinsky called the uncertainty and inconvenience in such cases "an unfortunate result of what happens when an insurer and provider cannot agree on a contract."

Blue Shield says the amount it has to pay for members' treatment at UCLA has nearly doubled over the last five years. UCLA says medical costs keep rising and it doesn't want to shortchange its practitioners.

In January, I told the story of a Pacific Palisades woman who couldn't get cataract surgery because Blue Shield was balking at her being treated at UCLA. At the time, the insurer and the university acknowledged that they weren't even speaking to each another.

Blue Shield now says UCLA has submitted a contract proposal that's worthy of discussion. But it says the two sides are nowhere close to nailing down an agreement.

Shivinsky said UCLA's offer "is long and complicated and proposes only a one-year duration. We much prefer multi-year agreements to give people the confidence that we won't be back in this same place a year from now."

But he said Blue Shield won't agree to any proposal that results in "huge rate increases" to accommodate higher reimbursement to doctors.

"We've said all along that we didn't want to cut UCLA from our network," Shivinsky said. "But we're not going to take them back at any price."

For its part, UCLA indicated that it also sees hard bargaining ahead.

"UCLA Health System's top priority is to provide the best possible care to all our patients, including those who use Blue Shield as their insurer," a spokeswoman for the campus said in a statement.

"Therefore," she said, "earlier this month University of California Health Sciences and Services sent Blue Shield a proposal. UC has yet to receive a response and we are not currently at the negotiating table."

If there's a bright spot to this whole mess, it can be seen in Ryan Perl's insurance coverage. He's a direct beneficiary of President Obama's healthcare reform law.

In the past, young people would be cut from their parents' family plan once they entered adulthood. Thanks to the reform law, a young person can remain on the family plan to age 26.

"I can't tell you how important this has been to us," Perl said. "I lost a lot of sleep worrying about what would happen to Ryan as he got older. I still have sleepless nights thinking about what will happen after he turns 26."

For the time being, though, his son remains insured and thus within reach of affordable healthcare.

As long as Blue Shield and UCLA can kiss and make up, that is.

David Lazarus' column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5. Send your tips or feedback to

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