An effort by the Idaho Elks to be recognized as a Twin Falls County health-care provider could reopen a legal issue stemming from the intricate 2006 sale of the county hospital to St. Luke's Health System.

The county and St. Luke's signed a settlement agreement modifying the sale just months ago following extensive negotiations. But the Wednesday-morning request from Boise's Idaho Elks Rehabilitation Hospital led county commissioners to push to change one aspect of a cap on indigent costs, surprising the CEO of St. Luke's Magic Valley Medical Center.

In 2007, St. Luke's Magic Valley replaced its transitional-care unit with an inpatient rehabilitation unit. It relied on the Idaho Elks Rehabilitation Hospital in Boise as advisors, and formed a joint venture - St. Luke's Idaho Elks Rehabilitation Services - to take over outpatient rehabilitation.

The Elks have been a presence in Twin Falls since, tallying about 5,000 patient encounters each year and performing a little less than $5 million in services. But the state hasn't recognized them as a provider in Twin Falls County, said CEO Joe Caroselli, because the county never formally invited them in as a necessary provider.

That affects what the Elks can bill for and resulted in inefficient arrangements for the organization, including a need for two separate billing systems, Caroselli said. Fixing it might save the Elks at least $200,000 a year, and he supplied commissioners on Wednesday with a draft contract based on the one approved for St. Luke's Mountain States Tumor Institute several years ago.

Commissioners George Urie and Tom Mikesell in turn said they feel the Elks' services are vital. But the county may have to consult Duane Morris, the national legal firm that's received nearly $130,000 in public funds to develop the 2006 agreement and handle issues stemming from it, to make sure the Elks contract wouldn't cause issues. They also argued for modifying the settlement - currently, the Elks joint venture is exempt from a $1 million cap on county indigent costs. MSTI is also listed as exempt.

"The more you expand out there, if you look at it financially, the more we pay for indigent care," Urie said, arguing the exemption should go away.

The Elks have yet to apply for indigent care for a patient in Twin Falls County, said Chief Financial Officer Douglas B. Lewis. But Caroselli said he understood the county's concerns and would support changing the cap.

Getting St. Luke's on board may be more difficult. St. Luke's Magic Valley CEO Mark Schwartz, asked Wednesday evening about altering the indigent cap, said he'd need to talk to Caroselli about the matter.

"That would not be consistent with the agreement, and we need to look at that," he said.