UnitedHealthcare sent out an advanced notice to more than 700 hospitals that its emergency room contractor, Envision Healthcare, could be out of network starting January 1, 2019.
WHY IT MATTERS
Dissolving the contract is expected to result in more "surprise bills" for patients who are unaware that their ER doctor, anesthesiologist or radiologist is out-of-network for their insurance coverage.
THE BIGGER TREND
Both hospitals and UnitedHealthcare would bear the brunt of patient complaints, at a time when consumer satisfaction is seen as a priority for value-based care and in rankings that include patient surveys.
UnitedHealth said it plans to update its provider directories to show its beneficiaries those hospitals that use non-participating hospital-based physicians. It is also activating a dedicated hotline for members to call if they receive a surprise bill from Envision and UnitedHealth said it would advocate on their behalf to have the bill waived or reduced.
ON THE RECORD
"A study published by the National Bureau of Economic Research shows ER physicians are paid on average 297 percent of what Medicare allows," said Dan Rosenthal, president of UnitedHealthcare Networks in the letter to hospitals. "In comparison, Envision demands to be paid nearly 600 percent of Medicare, two times this amount for ER physician services."
Envision said by statement, "We have offered United a solution that helps with the affordability of healthcare, and yet United is making egregious demands that will force all of our physicians out of network. They've elected to use data for one group in one market and have presented it as the single source of truth. This is misleading and designed to fit their narrative rather than the reality."
Envision said there were never any problems until UnitedHealth demanded massive cuts to allow it to stay in-network. It calls the insurer's letters to its hospital partners "aggressive" and "filled with half-truths and inaccuracies."
UnitedHealthcare, the country's largest insurer, said it has offered Envision competitive rates for all of their hospital-based services, similar to what other ER and hospital-based physicians are paid in each market, and given them the opportunity to earn additional reimbursement based on the value they bring to customers.
In May, a court ordered arbitration between the insurer and network provider after dismissing a lawsuit brought by Envision claiming UnitedHealthcare changed its payment rate agreement. Envision charged patients at rates three times higher than it should have, UnitedHealth said. Envision said this was due to out-of-network charges because the insurer refused to bring Envision provider groups into their contract agreement.
This is about money, with patients paying the difference and hospitals caught in the middle. A hospital can choose to employ physicians, but many doctors are independent contractors, including emergency room physicians. Since, Envision has its highest concentration of contracts with UnitedHealthcare in Florida, Texas and Arizona and to a lesser extent, in New York, Wisconsin, Georgia, Tennessee and California, both patients and hospitals in those regions are likely to find themselves managing more surprise bills.