News Releases

Wellmark, Central Iowa Hospital Corporation Reach Agreement on Proposed West Des Moines Hospital

Contact:
Angela Feig
515.245.4551
feigab@wellmark.com

(Des Moines, Iowa) -- Wellmark Blue Cross and Blue Shield of Iowa and Central Iowa Hospital Corporation (which does business as Iowa Health-Des Moines) have agreed to a 10-year contract at discounted rates for Blue Cross and Blue Shield members at a proposed new hospital in West Des Moines if it is approved by the State Health Facilities Council (SHFC).

In addition, Central Iowa Hospital Corp. has agreed, as a part of its Certificate of Need application, to reduce its licensed bed capacity in total for its Des Moines-metro facilities and to maintain approximately the same inpatient staffed levels as exists today for all of its central Iowa hospitals.

Anticipating cost savings and efficiencies from the new construction, Central Iowa Hospital Corp. agreed to be reimbursed for services at a new West Des Moines facility at a rate significantly lower than at its other Des Moines locations, including Iowa Methodist, Iowa Lutheran and Blank Children’s Hospital.

"Unnecessary capacity in hospital beds has been our primary concern throughout this debate regarding the construction of new hospitals in West Des Moines. On the advice of our Customer Advisory Council, we engaged in discussions to see if reduced rates could be obtained at the new facility under a long-term agreement. Central Iowa Hospital Corp. has committed to reduce its number of licensed beds among its metro-Des Moines facilities, resolving our concern about over-capacity as well as the expense it potentially creates for consumers and the general public," said John Forsyth, Wellmark’s Chairman and CEO.

The agreement pertains to the proposed Michael R. Myers Hospital to be located in Dallas County.  Central Iowa Hospital Corp. has applied for a Certificate of Need to construct a 95-bed hospital in West Des Moines.  The application will be considered at the October 24-25 meeting of the SHFC. Wellmark will support this application.

Wellmark remains committed to Iowa's Certificate of Need rule, requiring that construction of all new hospital and related building projects be approved by the SHFC. Wellmark filed lawsuits earlier this year asking the court to determine whether the interpretation of the Certificate of Need program has been correctly applied when evaluating need for "replacement" facilities rather than "new" facilities.  The lawsuits are unaffected by this agreement. 

"We remain steadfast in our belief that a Certificate of Need process is necessary as an important tool to ensure the public has an opportunity to evaluate and justify the addition of any new health care facilities in the state," Forsyth said. "The public pays for these facilities through taxes and health insurance premiums. Thoughtful consideration of new capacity is important because escalating health care costs continue to be a top concern for all of us."

Wellmark, Inc. (www.wellmark.com) does business as Wellmark Blue Cross and Blue Shield of Iowa.  Wellmark and its subsidiaries and affiliated companies, including Wellmark Blue Cross and Blue Shield of South Dakota and Wellmark Health Plan of Iowa, Inc., insure or pay health benefit claims for more than two million members in Iowa and South Dakota.  Wellmark Blue Cross and Blue Shield of Iowa, Wellmark Blue Cross and Blue Shield of South Dakota, and Wellmark Health Plan of Iowa, Inc. are independent licensees of the Blue Cross and Blue Shield Association.

Copyright© 2008 Wellmark, Inc. All Rights Reserved.
Wellmark Blue Cross and Blue Shield is an Independent Licensee of the Blue Cross and Blue Shield Association. Blue Cross®, Blue Shield®, and the Cross® and Shield® symbols are registered marks of the Blue Cross and Blue Shield Association, an Association of Independent Blue Cross and Blue Shield Plans.