Blue Cross Blue Shield cut payments, hospital organization alleges

ST. PAUL, Minn. — Blue Cross and Blue Shield of Minnesota is accused of slashing payments to hospitals by the Minnesota Hospital Association. The organization represents most of Minnesota's hospitals. Lawrence Massa, President and CEO of the association, says Blue Cross will change its payment system for at least a dozen hospitals by May 1 from a negotiated discount to a rate unilaterally set by Blue Cross. The new reimbursement rates will be below-cost or marginally above-cost, Massa said.