Spearfish Regional Hospital and Wellmark Blue Cross and Blue Shield still don't have a contract, despite growing frustration from the community and help from a consultant.

"We will continue to work, but I'm beyond being hopeful at this point," said Larry Veitz, chief executive officer at Spearfish Regional Hospital, which is owned by Regional Health.

Since 2006, Spearfish Regional Hospital has been the only hospital in South Dakota and Iowa that doesn't have a contract with Wellmark. Without a contract, Spearfish hospital cannot be a preferred provider for Wellmark customers, which means those customers pay higher out-of-pocket expenses if they receive care at Spearfish Regional.

The two entities have been in near constant contract negotiations since 2006 trying to remedy the situation, but as 2009 gets under way, they are no closer to striking a deal than they ever were.

"I'm frustrated with both of them," said Seanna Linafelter of Spearfish.

A Wellmark customer, Linafelter swore that she would drive to Sturgis Regional Hospital, a Wellmark preferred provider, if she ever needed care. When she suffered chest pains in December, that plan went out the window.

"When you're having chest pains, do you drive … miles or six blocks?" she said. "We went six blocks."

She walked away with $776 in out-of-pocket medical costs, compared with the $150 she would have paid at a preferred provider facility.

"I'm frustrated that Spearfish hospital doesn't care any more about their 10,000 patients with Blue Cross Blue Shield; and I'm frustrated that Blue Cross Blue Shield doesn't care any more about their customers to sit down and talk this out," she said.

Veitz said from the start, the sticking point with Wellmark has been reimbursement rates.

Spearfish Regional argues that Wellmark offers unreasonably low rates of reimbursement. Wellmark claims their offers are comparable to what they pay to similarly-sized facilities.

Kevin Teale of Wellmark said the insurance company spent a month with a consultant, documenting "pricing margins" and negotiating details. The consultant is now working with the Spearfish hospital, Teale said.

"It's in that consultant's and the hospital's back pocket," Teale said. "Hopefully, with the data that we've shared, we believe we've made our case on our financial situation."

Veitz said Wellmark is asking the hospital to consider a fixed price payment for every patient admitted, no matter the care provided. The hospital is evaluating the proposal. "It seems to be unfair, but we would like to settle this, and we have always considered any proposal options in the matter," he said.

The arguments from both sides have grown tiresome for customers such as Linafelter and others.

Spearfish resident Kurt Triscori paid $11,000 out of pocket after taking his 19-year-old daughter to the emergency room in Spearfish. Katie Lindholm, also of Spearfish, paid twice as much out-of-pocket to have her son, Casey, treated at Spearfish Hospital rather than at a preferred provider facility.

Veitz admits he gets frequent calls from people frustrated over the stalemate between the hospital and Wellmark. He tells them he's doing the best he can to remedy the situation. "We continue to work with Blue Cross Blue Shield for a fair settlement," he said.

It's not enough for customers such as Linafelter.

"I'm so exasperated," she said. "There are still 10,000 people out here without (full coverage) …

"Where is this circle of care that Regional Health just professes and professes and professes?

Contact Lynn Taylor Rick at lynn.taylorrick@rapidcityjournal.com or 394-8414.

Spearfish Regional Hospital

Spearfish Regional Hospital is owned by Regional Health Inc, which owns seven hospitals in area towns, including Rapid City Regional Hospital. Spearfish Regional has 40 beds and employs 275 employees.

Blue Cross and Blue Shield provides coverage to 19,736 members in Butte, Lawrence, Meade and Pennington counties. Currently, Spearfish Regional is the only hospital in the state that doesn't have a contract with Blue Cross and Blue Shield.