Thousands of UnitedHealthcare customers are no longer covered at CHI Memorial

Nov. 01--Some 5,000 Chattanooga-area customers of UnitedHealthcare are no longer be able to use CHI Memorial hospital after officials at the two companies were unable to reach agreement on a new contract by a midnight Monday deadline.

Negotiators for the hospital and the insurance company are continuing to try to work out a way to resolve the dispute, which centers on how much money UnitedHealthcare is willing to reimburse the health care system for the treatment it provides patients.

"We offered a new contract that would increase how much CHI is paid every year," UnitedHealthcare said in a statement issued shortly after midnight. "But they refused and are insisting on raising costs at their hospitals by nearly 20 percent over three years. We are committed to continuing the negotiations and are hopeful an agreement can be reached as quickly as possible to restore our members' access to CHI Memorial. "

For their part, CHI Memorial officials said UnitedHealthcare's offer was not reasonable.

"Our inability to finalize a contract by the expiration date is a direct result of UnitedHealthcare's failure to accurately and fairly reimburse CHI Memorial for services and care provided to UnitedHealthcare members," the health care system said in a statement Monday.

"This is not to simply renegotiate contract payment rates, but to correct inequities in the contract. Recent analysis shows that CHI Memorial is the high quality, high value health system in Chattanooga, yet our reimbursement from UnitedHealthcare lags other payers and fails to reimburse for key outpatient services. We find ourselves unable to continue to function in this manner, and have requested that they work with us to restore our reimbursement to fair market rates," CHI Memorial said.

CHI Memorial CEO Larry Schumacher earlier this month told doctors that the insurance company also was not willing to negotiate any pay increases for physicians affiliated with the hospital, who have not been given an increase in salaries for eight years, according to CHI Memorial.

In a statement issued earlier this month, UnitedHealthcare disputed those claims, saying that CHI Memorial wanted too much money.

"CHI Memorial wants to raise the cost of care at its hospitals by double digits," the statement read, "and their proposed rate increases would result in our members and local employers both paying more for their health care for the next several years. We have committed to a relationship with CHI that is based on paying for increased quality and promoting better health for the people we serve and hope they will share this focus."

There are about 5,100 UnitedHealthcare customers in the Chattanooga metro area, according to a company spokeswoman. UnitedHealthcare is the nation's largest health insurance company.

According to CHI Memorial, facilities affected by the dispute include CHI Memorial's main hospital plus CHI Memorial Hospital Hixson and CHI Memorial Ooltewah Imaging Center. UnitedHealthcare said physicians from Memorial Health Partners Foundation and Memorial Heart Institute would also be affected.

UnitedHealthcare members include those with commercial group and individual plans, health care exchange plans, and AARP Medicare Complete plans, according to CHI Memorial.

UnitedHealthcare customers still will be covered if they are taken to CHI Memorial for emergency care, both CHI Memorial and UnitedHealthcare agreed.

Patients who are scheduled for a test or procedure after Monday should contact UnitedHealthcare by calling the telephone number on their membership card to determine if it will still be covered by insurance, CHI Memorial spokeswoman Lisa McCluskey said.

Any patients already in the hospital Monday will be covered until they are discharged.

But patients who are undergoing on-going treatment such as chemotherapy should contact the insurance company, McCluskey said.

Medicare members will not lose any of their coverage from UnitedHealthcare. Members enrolled in a Medicare Supplement Plan can see any provider who accepts Medicare patients, including CHI Memorial, so they would not be impacted by the change, according to UnitedHealthcare spokeswoman Tracey Lempner.

In addition, most group Medicare Advantage PPO plan members can see any provider who accepts Medicare for the same cost, regardless of whether that provider is in or out of network, she said.

The only change would be for UnitedHealthcare members enrolled in Medicare Advantage plans, who would have to pay higher out of pocket costs if they go to CHI Memorial Hospital in Chattanooga or CHI Memorial Hixson. CHI doctors from Memorial Health Partners Foundation and Memorial Heart Institute do not participate in United Healthcare's Medicare network, so those patients would not be affected.

UnitedHealthcare will work with members to find other medical facilities. "We are prepared to work with our members to identify other in-network facilities in the community for future health care services," spokeswoman Tracey Lempner said.

In a letter to its customers, UnitedHealthcare reminded its members that they can also use either Erlanger or Parkridge hospitals for in-network coverage.

Contact staff writer Steve Johnson at 423-757-6673, sjohnson@timesfreepress.com, on Twitter @stevejohnsonTFP, and on Facebook, www.facebook.com/noogahealth.

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