A day before their contract was due to expire, Blue Cross and Blue Shield of Minnesota and Fairview Health Services pulled back from the brink and signed an agreement that runs through 2009.
The new contract ends a month of uncertainty for tens of thousands of Blue Cross members who had been told they might soon have to find doctors outside of Fairview or pay higher out-of-network charges.
The old contract ends today for Fairview clinics and on Oct. 28 for Fairview hospitals.
"We had many good and useful discussions that helped us develop a mutually acceptable contract," said Mark Eustis, Fairview president and chief executive.
As is usually the case, contract negotiations had stumbled over prices. Blue Cross said Fairview was asking for rates that were higher than those of other providers. Fairview said it sought the same prices being paid by other major insurers.
Both sides claimed partial victory Thursday.
Eustis said the new contract would allow Fairview to "make appropriate investments so we can continue to provide exceptional patient care and service."
Colleen Reitan, Blue Cross president and chief operating officer, said the insurer had "made progress in keeping health care more affordable."