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									                           California Medical Association
                           1201 J Street, Sacramento, CA 95814-2906 (916) 444-5532
                           Physicians dedicated to the health of Californians


October 3, 2002


FR:       John Whitelaw, MD
          (County President)

RE:       Blue Cross/HCA Contract Termination

As you may be aware, the contract between Blue Cross of California and HCA’s six hospitals in
California terminated at midnight on October 1, 2002. The HCA hospitals affected include three
in southern California (Columbia Los Robles Hospital, Riverside Community Hospital, Columbia
West Hills Medical) and three in northern California (Good Samaritan Hospital, San Jose Medical
Center, Regional Medical Center San Jose). This is to provide you with additional information
regarding this termination and to answer questions that you may have.

•     The Blue Cross/HCA contract termination is effective October 1, 2002, and affects all Blue
      Cross HMO and PPO patients, including Prudent Buyer, CaliforniaCare, Point of Service
      members and Senior Secure members.

•     Medi-Cal beneficiaries and Medicare beneficiaries who have a Blue Cross supplemental
      policy for Part A and B are not affected by the termination.

Continuity of Care

•     Blue Cross has indicated that patients who have received pre-authorization from Blue Cross
      or a Blue Cross-delegated medical group prior to October 1, 2002 for services scheduled at an
      HCA hospital on or before October 31, 2002, will be covered at the patient’s in-network
      benefit level. Blue Cross-contracted physicians should be reimbursed for services provided
      at their existing contract rates. CMA recommends that physicians contact Blue Cross to
      confirm authorization and obtain payment guarantee.

•     Patients that have not received pre-authorization prior to October 1, 2002 must be redirected
      to an alternative Blue Cross-contracted hospital. Otherwise, for PPO members, the member’s
      co-pay will be based on the out-of-network hospital’s billed charges. HMO members will
      receive no benefits at an out-of–network hospital.

•     Blue Cross has indicated that patients that are in their second or third trimester of pregnancy,
      with expected due dates on or before April 15, 2003 may continue to have access to HCA
      hospitals and will be covered at the in-network coverage schedule of benefits.
•   Patients receiving ongoing outpatient treatment, such as oncology, home health, physical
    therapy, occupational therapy or speech therapy treatment as of September 30, 2002 will
    continue to have access to HCA Hospitals through October 31, 2002. Members whose
    treatment is expected to continue beyond October 31, 2002, should call the Blue Cross
    customer service number on the back of their card for transition assistance.

•   For members in a current course of treatment as of October 1, 2002, for an acute or serious
    chronic condition, Blue Cross has indicated coverage will be at the in-network benefit level
    and that Blue Cross will authorize these on a case-by-case basis, for each. Physicians should
    expect to be paid at their current contracted rate.

•   Physicians may request an extension of a patient’s higher, in-network coverage at a
    non-contracting facility by calling the Blue Cross number on the back of the patient’s
    card and asking for Transition Assistance. Blue Cross has indicated they will consider
    extensions on a case-by-case basis, based on medical necessity and the member’s ability
    to travel.

•   Blue Cross PPO members who are not in a current course of treatment at an HCA hospital
    may choose a non-contracting hospital, however, they may be responsible for higher out of
    pocket expenses.

•   Physicians may wish to contact one or more of the alternative hospitals to request that
    their medical staff applications be expedited.

•   Alternative Blue-Cross contracted hospitals include:

    Alternative Northern California Hospitals:
    Lucile Packard Children’s Hospital            Sutter Maternity & Surgery Center
    Stanford University Medical Center            Laurel Grove Hospital
    Menlo Park Surgical Hospital                  Eden Hospital Medical Center
    Valleycare Medical Center                     St. Louise Regional Hospital
    Sequoia Health Services                       San Leandro Hospital
    St. Rose Hospital                             Watsonville Community Hospital
    Dominican Santa Cruz Hospital                 Mills Hospital
    Community Hospital of Los Gatos               Washington Hospital
    O’Connor Hospital                             Santa Clara County Valley Med Ctr.

    Alternative Southern California Hospitals:
    St. Johns Regional Medical Center          Valley Presbyterian Hospital
    St. Johns Pleasant Valley Hospital         Granada Hills Community Hospital
    Simi Valley Hospital                       Corona Regional Medical Center
    Encino Tarzana Regional Med Ctr            Loma Linda University Med Center
    Encino Tarzana Regional Med Ctr.           St. Bernardine Medical Center
    Redlands Community Hospital                San Gorgonio Memorial Hospital
    Community Hospital of San Bernardino
    Northridge Hospital Med Center (Sherman Way & Roscoe Blvd. Campus)

•   For services not available at other in-network alternative hospitals, Blue Cross will cover the
    member at the member’s higher, in-network coverage level with Blue Cross authorization
    only. The member will still be responsible for a co-payment based on the non-contracted
    hospital’s billed charges. Again, Blue Cross has indicated they will evaluate these requests on
    the basis of medical necessity and the patient’s ability to travel.

•   Physicians with questions should call their Blue Cross provider representative or the Blue
    Cross Customer Service number on the back of the patient’s card. Patients may also receive
    transition assistance by calling the number on the back of their Blue Cross card.

•   Patients who encounter problems with Blue Cross regarding continuity of care or payment
    should contact the Department of Managed Health Care at 1-888-HMO-2219.

We hope that his information is helpful. We will communicate with you as more information
becomes available. In the meantime, please don’t hesitate to contact CMA’s Reimbursement
Hotline at 888-401-5911.

L:\Policy\COMMON\AileenW\Health Plan Issues\BC HCA Termination 100402 letter MECs.doc

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