Provider Law Likely Heading Back to Court

by Mark Friedman  on Monday, May. 5, 2008 12:00 am  

Lynn Weaks, CEO of Arkansas Surgical Hospital in North Little Rock, says the 41-bed facility won't be able to survive long term without higher reimbursement rates.

"In those cases, hospitals are told that is a contractual issue between the facility and the insurer," she said.

In determining a price, several factors are taken into account, QualChoice's Stock said.

"All the contracts that we have - not only specialty hospitals but all other hospitals and all provider types - are all negotiated contracts that each party gives and takes," he said. "It was not a take-it-or-leave-it kind of deal."

The Arkansas Hospital Association told Arkansas Business that hospitals have long negotiated rates based on several factors.

"Our position is we would like to maintain that negotiation power and not have everybody getting exactly the same [rates] all the time," said Paul Cunningham, the senior vice president of the hospital association. The three surgical hospitals are members of the hospital association.

Cunningham agreed with the insurance carriers: Insurance premiums could rise if all the hospitals were paid the same.


After Bowman handed down her ruling, Arkansas Surgical Hospital, the Surgical Hospital of Jonesboro and HealthPark Hospital appealed. The surgical hospitals wanted to get their hands on the contracts between some full-service hospitals and the insurance carriers.

The hospitals balked at the request.

St. Vincent Health System's attorney, Stephen Jones, said during an April 4 preliminary hearing in front of Bowman that releasing the contracts would give Arkansas Surgical Hospital a competitive advantage.

Bowman agreed with Jones and didn't release the contracts. St. Vincent's President and CEO Peter Banko said he was pleased with the ruling.

"The information requested by these attorneys was not relevant in the hearing conducted by the Commissioner regarding the right of insurance companies to consider differences in the scope of services when negotiating payment rates with individual hospitals," he said in a statement to Arkansas Business.



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