Alvarado Hospital Files Countersuit Against Blue Shield

According to Alvarado Hospital in a recent press release, Alvarado Hospital has recently filed a counter suit against Blue Shield claiming that Blue Shield allegedly refuses to pay Alvarado Hospital Competitive Rates for hospital patients compared to other Hospitals located around San Diego.

So is Alvarado Hospital just being greedy or is Blue Shield just trying to be a bully? Apparently Blue Shield has made a contract agreement with the previous owner of the hospital concerning payment rates and wants Alvarado Hospital to sign the same agreement. Alvarado Hospital does not see why they need to sign this contract, questioning it after none of the other insurance companies that they have dealt with have caused them any hassle like this. The problem is that Alvarado Hospital is an independent hospital and they are facing a big insurance giant that does not want to renegotiate higher rates with this hospital even though all the other insurance companies did.

So why won't Alvarado Hospital just sign the previous contract? Blue Shield is actually paying other hospitals twice as much per patient day in the same San Diego area because they are larger hospitals. Blue Shield targets stand alone hospitals with negotiating tactics because they do not mean as much and will not bring in nearly as much profit to Blue Shield as larger hospitals would. This makes hospitals like Alvarado Hospital very vulnerable.

"Blue Shield's calculated and aggressive negotiating tactics are designed to break the backs of independent hospitals like Alvarado," said Charles LaBella, Alvarado's attorney. "This counter suit will show the court that Blue Shield's bullying and bluffing have one motive -- to generate more profit for this supposedly non-profit insurance company, at the expense of Alvarado Hospital and its patients."

"We are not asking the court for special treatment," said LaBella, "we just want to make Blue Shield negotiate market-competitive rates. If these huge insurance companies are allowed to prevail, it sets a precedent that could drive Alvarado and other hospitals out of business."

"The issues facing Alvarado Hospital are indicative of the inequities that exist in the marketplace between health plans and hospitals," said Dietmar Grellmann, senior vice president, managed care and professional services for the California Hospital Association.

Along with this suit, there is a counter suit as well, claiming that Blue Shield tried forcing Alvarado Hospital into accepting these low rates by threatening them that they would get rid of the Hospital totally.

This will be a very heated court room case but hopefully all goes in Alvarado Hospital's favor for the wellness of their patients.

SOURCE

PRnewswire