Mind Uncharted Explore. Discover. Learn.
Salem Health Seeks Major Increase, Regence Offers Far Less
Nearly 30,000 patients in Marion and Polk counties have lost access to Salem Health’s services and providers as the health system and Regence BlueCross BlueShield of Oregon find themselves at odds over a significant increase in coverage.
Salem Health announced on Thursday that patients covered by Regence would no longer be able to utilize its hospital, providers, and specialty clinics. This standoff is just the latest in a series of contract disputes between insurance companies and providers as they navigate escalating costs.
Blame Game and Standoff
Both sides are pointing fingers at each other for this breakdown, with no clear resolution in sight. Cheryl Wolfe, president and CEO of Salem Health Hospitals and Clinics, expressed her frustration with Regence’s actions, calling them unacceptable and urging the insurer to extend continuity of care coverage for all affected patients.
Regence’s head of network management, Zak Ramadan-Jradi, disputed Salem Health’s claims, stating that both parties have been in communication and that Salem Health had recently requested an in-person meeting before sending out a press release criticizing Regence.
Negotiation Roadblocks
Regence has offered a proposal to Salem Health, but the health system has not responded. Salem Health contends that it has successfully negotiated contracts with 14 other insurers for 2025, with Regence being the only holdout due to their 4% increase offer, which falls short of the 6% increase in healthcare spending in Oregon between 2021 and 2022.
James Parr, Salem Health’s chief financial officer, emphasized the challenges that a nonprofit health system faces in sustaining quality care with inadequate contract offers from insurers like Regence.
Wide Gap in Perspectives
Ramadan-Jradi revealed that the two sides are still far apart in reaching a resolution. Salem Health is requesting a substantial 35% increase for 2025 and an additional 15% the following year, a demand that could lead to higher out-of-pocket costs for patients.
Regence’s offer, while unspecified, is in single digits and aligns with state law aimed at curbing healthcare spending increases. Healthcare costs have been rising significantly despite efforts to limit growth.
Current Stalemate and Future Outlook
The impasse between Salem Health and Regence underscores the challenges faced by providers and insurers in navigating rising costs and contract negotiations. As the situation unfolds, patients in Marion and Polk counties find themselves caught in the crossfire, deprived of access to critical healthcare services.
