10 hospitals sue Blue Cross for shortchanging them $13M

Ten hospitals have sued Blue Cross Blue Shield of Mississippi for allegedly shortchanging them by more than $13 million by improperly reducing inpatient payments for a variety of services, according to an Associated Press report.

The suit, which seeks to recover the money the hospitals claim they've been underpaid, contends that Blue Cross Blue Shield reduced its inpatient payments to the Health Management Associates-owned hospitals by rewording parts of the policy manual to reflect changes instead of actually negotiating any payment adjustments with the hospitals. Blue Cross didn't comment on the allegations.

"It's a contractual issue between the parties. They just made changes without notifying the hospitals. They made it unilaterally," Tom Kirkland, an attorney for the plaintiffs, told the Clarion-Ledger newspaper.

The lawsuit, only giving the hospitals' side of the argument, states changes to contracts between the hospitals and Blue Cross were to be mutually revised, and if Blue Cross was to make any changes to the contract, they had to make them known in writing 30 days day before the changes took place, according to the AP.

But after the two groups had a disagreement in 2011, the insurer put in new language without telling the hospitals.

"It is unfair for insurers like Blue Cross Blue Shield to not honor the amount they agreed to pay," Bill Williams, HMA's division CEO for the hospitals, said in an announcement of the lawsuit, according to the Clarion-Ledger. "That may benefit the insurance company and its executives, but it harms our hospitals and the communities we serve."

To learn more:
- read the AP report
- read the article in the Clarion-Ledger

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