Resolving dispute, Minnesota Blue Cross strikes in-network deal for St. Luke’s in Duluth

Blue Cross and Blue Shield of Minnesota says it has reached a new contract agreement that will maintain St. Luke’s Hospital in Duluth as part of the insurance company’s network of health care providers next year, resolving a dispute that first surfaced over the summer.

The deal, which Eagan-based Blue Cross announced Friday, means there will be no disruption for about 50,000 subscribers at the state’s largest Medicare health insurer who get care at facilities run by Wisconsin-based Aspirus Health, the nonprofit parent company for St. Luke’s.

The hospital is Duluth’s second-largest medical center. The health system also includes Lake View Hospital in Two Harbors plus a surgery center and several affiliated clinics.

Aspirus and Eagan-based Blue Cross first disclosed the contract impasse in August. Uncertainty for patients created by the dispute has been part of an unusually volatile open enrollment season this fall for Medicare beneficiaries, including fewer health plan choices and higher prices across Minnesota.

Fairview Health Services and UnitedHealthcare, two of the largest health care organizations in the state, announced this fall that about 33,000 patients statewide with Medicare Advantage coverage may have to find new care or insurance providers as their ongoing talks had not produced an agreement.

Fairview and UnitedHealth ultimately struck a deal to avoid disruption for Medicare Advantage patients, only to announce in November a larger dispute over commercial coverage.

The companies say there’s been no resolution to the dispute, which could block 125,000 patients with employer coverage via UnitedHealth from scheduling visits next year with Fairview doctors and hospitals.

During the dispute, Blue Cross alleged St. Luke’s wanted unreasonably high prices. The hospital countered the health insurer’s payment rates were inadequate.

Mark Steffen, the chief medical officer at Blue Cross, said in a statement about the new agreement that the insurer was committed to providing “access to high-quality care at a fair value.”