Broward Health and Florida Blue contract dispute may put 17,500 patients out of network

In the newest contract breakdown between a health insurer and a South Florida provider, Florida Blue policyholders may end up facing higher costs.

Florida Blue has sent letters to 17,500 people in Broward County, notifying them that, as of July 1, Broward Health will become an out-of-network provider because of the contract dispute.

The insurer told its members that Broward Health is demanding contract terms with significantly higher rates that would have to be passed on to patients.

“Unfortunately, this could result in drastic increases in health care costs for our members,” the letter sent Thursday said. “This raises how much you pay for services at Broward Health and could drive up your health insurance each month. During these challenging economic times, such large rate increases are not sustainable.”

David Wagner, the South Florida market president at Florida Blue, said his team and Broward Health have been negotiating a new contract for three months and the two entities are vastly far apart in agreement. Florida Blue has had a contract with Broward Health for more than 30 years, Wagner said. The contract allows Florida Blue’s members to use Broward Health as an in-network provider, which affects the rate that the insurer pays the hospital system for patient care.

“We have never had a negotiation like this,” Wagner said. “They are asking for a 60% increase over the previous contract. It is much higher than in the past. It’s an unreasonable ask.” He said that past increases have fluctuated between 1% and 3% during contract renewals.

Broward Health spokeswoman Jennifer Smith said they, too, sent notification letters to their patients and physicians about the inability to renew their contract with Florida Blue.

“They are amongst our lowest payers and unfortunately negotiations haven’t been successful to this point,” Smith said. “We will continue to work hard to get something done by July 1. We will continue to do our best and look at different strategies to ensure that policyholders with Florida Blue do not face any hardships due to this.”

If the insurer and provider fail to come to terms on a contract by June 30,  patients in need of major surgeries scheduled at Broward Health will have to pay high out-of-pocket rates or reschedule the surgeries at other hospitals. And Florida Blue members who receive medical services at Broward Health hospitals will have to pay higher out-of-pocket costs for each visit or find an in-network provider.

Broward Health, a public hospital system, serves the northern half of Broward County with five hospitals including Broward Health Medical Center in Fort Lauderdale, Broward Health North in Pompano Beach, Broward Health Coral Springs, Broward Health Imperial Point in Fort Lauderdale, and Salah Children’s Hospital in Fort Lauderdale.

“We understand the value of Broward Health and what they give to the community,” Wagner said. “However, it’s a $150 million increase. We have to be good stewards of our community and we can’t pass that on to our members, especially in light of these inflationary times.

“We want to continue the partnership,” Wagner said. “We are asking for a reasonable partner in this negotiation.”

Smith said Broward Health wants Florida Blue to value its service to the community, and increase its reimbursement rate.

“We have expectations that our exceptional care provided is recognized and as of now that’s not happening,” she said. “We recognize the value of our physicians and the care they provide, and we want our payors to do the same.”

Across Florida, health insurers and providers have been in standoffs over contract negotiations in the last few years as healthcare costs rise and contracts come up for renewal.

A contract dispute between UF Health and UnitedHealthcare arose last year and lasted for months and affect more than 100,000 members. The parties finally reached a multi-year agreement that restored network access to those enrolled with the insurance company. Blue Cross Blue Shield and Memorial Healthcare System also had a contract dispute in September 2020. Negotiations began with Memorial seeking a 40% increase over its prior contract, claiming it hadn’t received fair price increases. The two eventually reached an agreement.

South Florida Sun Sentinel health reporter Cindy Goodman can be reached at [email protected].

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