A Pocatello hospital's break with Regence BlueShield of Idaho reached the Statehouse on Tuesday, where lawmakers heard a number that turned a local access dispute into a statewide cost question. Faith Knowlton, who leads Idaho's Office of Group Insurance, said meeting the hospital owner's requested reimbursement increase could have lifted costs for the entire 65,000-member state health plan by 7 percent.
About 3,000 members would have remained in network at Portneuf Medical Center under that deal, she said. The math now before legislators is blunt: how to protect access for East Idaho families without shifting a large increase onto tens of thousands of public workers and dependents across Idaho.
Portneuf left the network on June 15
Portneuf's agreement with Regence expired June 15 after the sides failed to settle a new contract. The Pocatello hospital says it is now out of network for all Regence plans. Emergency care remains covered at in-network rates, while non-emergency treatment may bring higher out-of-pocket costs or require patients to use a different provider.
Regence covers Idaho state employees and their family members. Knowlton told lawmakers that roughly 3,000 plan members were affected by Portneuf's network status, while any accepted increase would have reached all 65,000 plan members.
The dispute is not only about one rate. Portneuf says Regence denies a substantial share of its claims and owes millions of dollars in unpaid claims. Regence says the hospital owner's initial reimbursement request was unusually large. Portneuf is controlled by Ardent Health Services, a for-profit company that Regence said owns more than 285 clinics and hospitals nationwide.
Both sides say talks continue. Neither claim settles the central question for families: whether local access can be preserved at a price the broader plan can absorb.
Republican leaders opened a statewide review
House Speaker Mike Moyle and Senate President Pro Tem Kelly Anthon formed the Idaho Health Insurers Working Group after concerns grew over Portneuf's network exit and health insurance practices statewide. Republican Rep. Dustin Manwaring of Pocatello and Republican Sen. Mark Harris of Soda Springs co-chair the eight-member panel.
The group's official charge goes beyond contract bargaining. Lawmakers are assigned to examine claim-denial rates, expected provider reimbursements, prior-authorization delays, accepted but unpaid claims, effects on patient health, and possible legislative remedies.
Manwaring emphasized that insurance friction can force patients to travel farther, lose work time or wait longer for care. Those consequences are especially sharp in communities where replacing a major hospital is not as simple as driving across town.
Knowlton also gave Regence credit, calling it a strong partner to the state and saying the company has supplied requested information. She said she believes Regence currently satisfies state network rules because other providers are available in the area. State attorneys are separately reviewing whether the insurer meets its obligations under Idaho's contract.
The panel is not starting from a conclusion that either the insurer or hospital is solely responsible. It is starting with a public cost, a local access gap and competing claims that lawmakers can test.
Pricing secrecy is the next accountability test
The first meeting exposed a second issue: lawmakers may struggle to see the prices and penalties that determine what Idaho gets for its money. When senators asked about hospital-by-hospital reimbursement and penalties tied to Regence performance, Knowlton said some information may be protected as trade secrets or require Regence's approval before disclosure.
The group plans to finalize a question list for insurers, providers and possibly the public by August 21. Its next meeting is scheduled for September 15, with three more meetings planned before the 2027 legislative session.
By that session, the panel will have to decide whether Idaho law needs clearer standards for network access, claim handling and public-plan costs. For Idaho workers and families, the measure will be concrete: whether care stays close to home without a hidden bill landing somewhere else in the state.