Memorial Hermann Greater Heights Hospital

A brewing contractual battle between Blue Cross and Blue Shield of Texas (BCBSTX) and Memorial Hermann Health System could leave local residents out of network or in search of new medical providers.

The hospital system recently sent a notice of termination of its contract with the insurer, which expires Feb. 28, and BCBSTX responded by issuing a termination of its physician agreements with Memorial Hermann, the health system acknowledged in a statement provided to The Leader on Tuesday. If the two sides cannot come to terms before their contract expires, Memorial Hermann patients with BCBSTX policies would face higher, out-of-network costs for medical services provided by their existing physicians.

The largest hospital system in the Houston region includes Memorial Hermann Greater Heights Hospital, 1635 North Loop West, along with a few urgent care, convenient care and sports medicine facilities in the area.

"Nothing changes for our patients at this time," Memorial Hermann said in its statement. "They can and should continue to seek care from their trusted Memorial Hermann providers and facilities as they normally would."

Blue Cross and Blue Shield of Texas did not respond to a Tuesday email seeking comment that was sent to its media relations staff. The insurer told the Houston Chronicle it was caught off guard by Memorial Hermann's notice of termination and aims to keep costs down for its members in its negotiations with the health system.

"Ultimately, price increases do translate into premium increases," Shara McClure, senior vice president of Texas health care delivery for BCBSTX, told the Chronicle.

More than 100,000 Memorial Hermann patients hold BCBSTX insurance policies, according to the Chronicle, and the insurer's termination of physician agreements with Memorial Hermann would allow its 2,000-plus physicians in the BCBSTX network to contract directly with the insurer.

Memorial Hermann described the termination of physician agreements as "atypical" during the 15-plus years the two entities have negotiated with each other. The health system also said issuing a notice of contract termination is part of its "routine negotiation process with BCBSTX" so the two parties can align around the same deadline.

"We remain committed to working with BCBSTX to reach a new agreement that prevents any disruption in the high-quality care Memorial Hermann provides to our patients," the health system said. "We look forward to BCBSTX doing the same by actively engaging in meaningful discussions to protect our shared patients’ and members’ in-network access to Memorial Hermann."

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