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In light of the recent press releases by both Blue Cross Blue Shield of Michigan and Michigan Medicine (the University of Michigan’s medical school, hospitals and healthcare system), it is worth some conversation to put things in perspective.

If you are a Blue Cross Blue Shield of Michigan member and a patient of any of the University of Michigan health systems, you’ve likely received a letter from these entities notifying you that without a successful resolution to negotiations, your care will likely not be covered as in-network after June 30, 2026. This letter, depending on the sender, has tried to convince you that this is a stalemate and without your involvement (pressuring your provider or insurance carrier to be reasonable), there is no hope.

According to The Michigan Daily, “BCBSM reports Michigan Medicine is demanding a 44% increase in reimbursement in comparison to the current contract. Michigan Medicine said that BCBSM is demanding a 30% decrease to their reimbursement rate.” Both are probably true and neither will actually be realized.

This is a tactic and an exaggeration which is designed to create panic and emotional response designed to influence the other party.

The truth is that network and hospital system negotiation delays are increasingly resulting in publicized disputes. Since 2021, there have been between 500 and 600 publicized standoffs nationwide between parties which threaten patients with out-of-network charges. This is about 1 in 5 hospitals having at least one dispute with an insurance company. Of those, only 8% of the hospitals actually went out-of-network.

So while an overwhelming majority of these negotiations are resolved in the 11th hour, there can be situations where patients are faced with adjusting providers. Under the No Surprises Act of 2022, protections are in place for patients if a provider drops out of network which will allow patients to continue care for serious conditions as in-network for up to 90 days.

In summary, these provider negotiations are common. While there’s always a potential that a provider group would no longer be considered in-network, it’s unlikely. The majority of these negotiations are resolved, but many very close to the deadline. It’s important for members to be aware, but no action is needed until the actual deadline. Even so, there is a 90 day transition period that is allowed for continuity of care in the event a provider switch is necessary.  


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