Providence, Regence deadlock threatens Oregonians’ health care

Oregonians with Regence insurance will no longer be covered at Providence facilities if the two companies can’t reach a deal on reimbursement rates by Jan. 15.

PORTLAND, Ore. — Time is running out for contract renewal negotiations between a prominent Portland hospital group and a major Oregon insurance company, leaving the fate of more than 260,000 Oregonians’ health care hanging in the balance.

Providence Health and Services is seeking increased reimbursement rates from the insurance company Regence Blue Cross Blue Shield to keep up with rising health care costs and employee wages. Providence said drug and supply prices jumped 19% from 2020 to 2022 and are still rising, and the company also pointed to “major monetary losses since the COVID-19 pandemic began.” 

In a news release two weeks ago, Regence said Providence had sought “an enormous double-digit price increase” that would have cost more than $144 million in just one year, and asserted the result would be higher premiums and out-of-pocket charges; for example, raising the cost of having a baby by C-section by about $5,500.

Providence will leave the Regence network if the two companies don’t reach an agreement by the current contract’s Jan. 15 expiration date, meaning patients with Regence insurance would have to begin paying out-of-network rates at Providence hospitals. Providence would also leave the Regence Medicare Advantage network on Feb. 15 unless a deal is reached.

“I worry about all the people in this area, there are a lot of people that depend on Providence for their health care,” said Kendall Stowell, who works near Providence Portland Medical Center. 

Those people include Mary Grebisz and her children, who rely on the Providence system for specialized care. Grebisz said her children have emotional and intellectual disabilities, but Providence offers a program that has been a “saving grace” for the family. She said her family would be severely impacted if the companies don’t reach a deal.

“It would probably mean we would have to travel outside of the city to get programs like that, or it could also mean that we would have to pay more than we do right now out of pocket,” she said.

KGW reached out to Regence twice on Monday and will update this article if the company responds. Providence said in a statement that it is hopeful an agreement can be reached in the next four weeks without disrupting patient care. Providence urged patients covered by Regence to reach out to the insurance provider if they have questions.

“We are working tirelessly to combat rising costs, yet we cannot do it all on our own… failure to account for these costs affects our ability to adequately pay the dedicated individuals who work in our clinics and hospitals,” Providence said.

This past summer, Providence nurses went on strike and ultimately secured historic wage increases, which the hospital said also added to its financial pressures.

“The way that health care is set up these days and the way it’s been these last few years, it doesn’t surprise me at all when it comes to medical and health care stuff,” Grebisz said.

“Their goal should be to serve more people, as many people as you possibly can,” Stowell added.

BlueCross BlueShield is a brand name shared by an association of separate health insurance companies nationwide; the dispute with Providence is specific to Regence BlueCross BlueShield of Oregon.

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