Michigan Medicine and Blue Cross Blue Shield contract stalemate leaves patients in limbo

Blue Cross Blue Shield of Michigan is telling members who go to Michigan Medicine to start looking for other providers.

The insurance company's contract with the healthcare system ends on June 30, and negotiations for a new one have been unsuccessful so far.

University of Michigan Hospital patients like Larry Prout Jr., who's had more than a hundred lifesaving operations there, say his family is facing major out-of-network medical costs or giving up their 20-year relationship with University of Michigan doctors if Blue Cross Blue Shield and Michigan Medicine can't agree to a new contract by the deadline.

"I don't know what we would do. Stay at Michigan Medicine, and that's all we would have to do, and just figure it out," said Larry Prout Jr.'s mother, Kathryn Prout.

Switching providers isn't an option for Larry Prout Jr., who's been a patient at Michigan Medicine since before he was born.

"I would be nervous doing something like that because I don't know any other hospitals that would know me," he said.

The relationship he has with the University of Michigan doctors, his family says, is as vital as the specialized care he receives there.

"He has so many emergencies with blood infections and sepsis, respiratory, life-threatening things. To have to go somewhere else entirely and build those relationship, I don't know how that's going to go," Kathryn Prout said.

Blue Cross Blue Shield says Michigan Medicine is asking them for a 44% price hike in the next contract, a price the insurer says they won't agree to.

"If we pay Michigan Medicine much more than we pay them today, those costs are going to flow down into the health insurance premiums that families and insurers are paying. Families and employers right now are finding health insurance unaffordable," said BCBS of Michigan Communications VP Andy Hetzel.

BCBS issued a statement on Wednesday updating its members, saying:

"Michigan Medicine's decision to terminate their contract with Blue Cross puts patients with very complex, lifethreatening conditions in the middle of our contract negotiations. Blue Cross is supporting approximately 48,000 members through this very stressful period by qualifying them for Continuity of Care services within the Michigan Medicine system for 90 days starting July 1. Giving these Blue Cross members time to continue their current course of treatment at Michigan Medicine gives them the comfort of working with their current doctors, while also having time to find alternative care arrangements, should we not reach agreement before June 30. Individuals who qualify for Continuity of Care will be notified directly by Blue Cross. Our program was rigorously designed by our medical staff using specific clinical criteria derived from claims data. Ultimately, the best way to help these patients is coming to agreement on a new contract that allows for us to continue to pay Michigan Medicine for their care. Blue Cross is working hard to provide payment to the Michigan Medicine system that is fair to them, and affordable for our customers and members who ultimately pay the bill."

Michigan Medicine told CBS News Detroit that it is working to come to an agreement by the June 30 deadline. The healthcare system says that protecting patients and ensuring uninterrupted, life-saving care remain its priorities.