Home / 2015 / January / Blue Shield of California and Sutter Health Provider Negotiations- Contract Termination and Transition Period

Blue Shield of California and Sutter Health Provider Negotiations- Contract Termination and Transition Period

To: UCSC Staff and Faculty

From: Lori Castro, Interim Assistant Vice Chancellor, Staff Human Resources; Pamela Peterson, Assistant Vice Chancellor, Academic Personnel

January 07, 2015

As you may have heard, Blue Shield of California and Sutter Health were unable to agree on a contract for 2015, which affects many UCSC employees using the Palo Alto Medical Foundation.  On January 5th, 2015, Blue Shield of California sent letters to more than 140,000 members state-wide who are users of Sutter Health in Northern California, informing them that the Blue Shield/Sutter Health contract was terminated, effective Dec. 31, 2014.  However, there will be a six-month transition period for UC Blue Shield plan members.

University of California employees (and retirees) are affected by this development if they use Sutter providers, including Palo Alto Medical Foundation (PAMF), and if they are enrolled in the following UC health plans:

•    Blue Shield Health Savings PPO
•    Core Medical PPO
•    UC Care PPO

Blue Shield has directly contacted members in the aforementioned plans, but we would like the campus community to be aware of the situation.

From January 1, 2015 thru June 30, 2015 there will be a six-month transition period to allow UC Blue Shield plan members time to find an alternative provider.  During the transition period UC plan members will continue to receive services at the UC Select level at the Palo Alto Medical Foundation.  Blue Shield Health Saving Plan and Core Plan members will continue to have the preferred 80% coverage at the Palo Alto Medical Foundation but can anticipate a higher cost due to the fact the 80% coverage will now be on a non-contracted rate.  

Contract negotiations are ongoing, and it is our hope that Sutter Health and Blue Shield will come to an agreement before the transition period ends. If the parties do not come to an agreement, we anticipate the University of California will announce a plan but for now there is no additional information. The UC is not authorizing a special opportunity for employees to change medical plans at this time. 

Questions regarding the Sutter Health/Blue Shield contract or finding alternative providers should be directed to Blue Shield at 855-201-2087. Questions about the UC plans can be directed to the UCSC Benefits Office; contact Frank Trueba, Benefits Manager at 459-3573.