Sarasota Memorial Hospital and UnitedHealthcare face deadline for Medicare Advantage pact
Sarasota Memorial Health Care System and UnitedHealthcare are at loggerheads over a contract for the public hospital to be considered an in-network provider for the insurance company’s Medicare Advantage plan.
While the contract between Sarasota Memorial and United runs out Dec. 31, that deadline is trumped by the Dec. 7 date for the end of open enrollment, when people can easily change or modify their Medicare plans.
Open enrollment began on Oct. 15.
If the two sides fail to come to an agreement, it could impact more than 20,000 people who currently use UnitedHealthcare’s Medicare Advantage plan in the region.
Sarasota Memorial accepts traditional, government-run Medicare Part A for hospital insurance and Part B for health care providers and outpatient care.
People with original Medicare and standard supplemental coverage are not impacted.
Sarasota Memorial has been running full-page ads in local newspapers urging Medicare recipients to check on the status of their Medicare Advantage plans, also known as Part C, which is offered by several private providers.
The healthcare system has also been sending letters to 22,165 people who have used Sarasota Memorial’s two hospitals and 12,172 people who seek care through First Physicians Group-based providers.
Because some people use both, they may have received two letters.
The newspaper ads list six Medicare Advantage plans that consider SMH and First Physicians in-network, as well as six Medicare Advantage plans that will consider treatment at SMH and by its doctors as out-of-network. United is listed among that group, along with an asterisk, noting that unless they agree to contract by Dec. 31, SMH will no longer be in-network with United.
The ad also directs people with overall questions to contact SHINE – Serving Health Insurance Needs of Elders – a free program offered by the Florida Department of Elder Affairs and the local Area Agency on Aging at 1-800-963-5337 or at https://www.floridashine.org.
Medicare contract negotiations are continuing
UnitedHealthcare spokesman Cole Manbeck said via email: “Our goal is to renew our relationship with Sarasota Memorial Healthcare System and ensure the people we serve have continued, uninterrupted access to the health system.”
In response to an email query from the Herald-Tribune, SMH spokeswoman Kim Savage wrote, “Sarasota Memorial is engaged in good-faith negotiations and working diligently with UnitedHealthcare to address concerns we have with their Medicare Advantage plans before our current agreement expires at the end of the year.
She added that while it’s a normal practice for hospitals and health insurers to renew contracts every few years, “in recent years, hospitals across the nation have found it increasingly difficult to work with certain Medicare Advantage plans that routinely deny or restrict coverage for essential care and reimburse far less than traditional Medicare.
“Sarasota Memorial and First Physicians Group have experienced these challenges with United’s Medicare Advantage plans” she added. “We are asking United to address these issues with provisions that better protect patients from inappropriate claim/coverage denials and ensure comprehensive access to care.”
She said that the dispute with UHC specifically involves the Medicare Advantage coverage.
For example, services provided at the new SMH Behavioral Health Pavilion, which opens next week are not impacted, “as mental/behavioral health services are covered under a separate contract.”
Deadline healthcare negotiations are commonplace
This negotiation brinkmanship has become all too familiar for Sarasota County residents, as the two sides haggle over what procedures will be covered and at what rate of compensation.
Most recently, in June, 2021, Sarasota Memorial and Florida Blue struck an 11th hour deal that kept the hospital and its affiliated medical practice, First Physicians Group in-network providers for Florida Blue.
At that time, negotiations covered both basic things, such as reimbursement rates the doctors and the hospitals received for procedures, as well as addition of coverage to the hospital’s radiation oncology specialty.
In the case of the schism between SMH and UHC, local insurance agents and industry professionals have been reaching out to both SMH and local media to voice their concerns.
“Everyone knows this is about money,” Michelle Litzer, a Nokomis-based insurance agent specializing in UnitedHealthcare policies wrote in an open letter to the hospital board. “And history shows that SMH and each insurer about ready to expire start shaking hands closer to the ending dates or extend.”
“It is my personal opinion that there should not be contracts expiring at the end of calendar years so close to Annual Enrollment to instill this fear and have folks have to make a knee-jerk reaction to protect themselves without proper time to consider all coverage aspects,” she added.
Litzer called it ironic that SMH is a public hospital that offers care to the uninsured.
Healthcare Corp of America, which owns the other two Sarasota County hospitals – HCA Florida-Sarasota Doctors Hospital in Sarasota and HCA-Florida Englewood Hospital – negotiates healthcare contracts on a national basis.
A spokeswoman for HCA-Florida Doctors Hospital noted that plans accepted there can be found on its website: https://www.hcafloridahealthcare.com/locations/sarasota-doctors-hospital/for-patients/participating-insurance-plans.
Kristine Russell, a healthcare content specialist who is a publisher and executive editor of several national healthcare publications, including Healthcare Purchasing News and the HPN Daily Update newsletter, said it was concerning that a letter from SMH discussing the lack of progress on negotiations was dated Nov. 17.
“Earlier UHC had sent out a letter notifying customers that there were minor changes to the Medicare Advantage plan coverage for 2024 for their Sarasota customers that certainly didn’t offer any notification of a removal of their SMH hospital or provider coverage,” Russell wrote
She noted that United Healthcare Group posted record profits on Oct. 13, with revenues of $92.4 billion reflecting a 14% year-over-year increase, and referenced a 2014 spat between the two the hospital and the insurer.
Medicare Advantage under scrutiny
Reports in publications ranging from USA Today to Becker’s Hospital Review have documented a nationwide reluctance demonstrated by hospital companies to accept reimbursement rates offered by a variety of Medicare Advantage companies, including United.
A report in USA Today attributes one reason for the negotiations becoming more “tense and public … as hospitals seek adequate payments and health insurance companies attempt to check spiraling medical bills.”
It noted that “hospitals that are rejecting private Medicare plans say they don’t reimburse at the same levels as traditional Medicare, delay or deny care through prior authorizations or impose other limitations.”
Denials of care by Medicare Advantage plans have also hamstrung hospitals.
Becker’s Hospital Review reported that research published Nov. 17 by the American Hospital Association and the data analytics company Syntellis Performance Solutions found that between January 2022 and July 2023 Medicare Advantage denial-related revenue reduction increased by 55.7% for the median hospital.
That research covers a nationwide sample of 1,300 health care systems and hospitals.
Medicare Advantage plans may offer consumers additional coverage – an advertisement placed by one provider in the same Nov. 26 edition of the Herald-Tribune as the SMH ad – touted prescription drug coverage (also available with traditional Medicare plans through Medicare Part D coverage), routine dental vision and hearing coverage, and a rebate of $1,978.80 on Medicare Part B premiums.
The catch is those plans also enlist a limited number of in-network providers that agree to their reimbursement rates and may require prior authorization for many services.
More information on Medicare open enrollment can also be found at https://www.medicare.gov.Updates on Sarasota Memorial’s negotiations with United Healthcare can be found at smh.com/unitedhealthcare.
This article originally appeared on Sarasota Herald-Tribune: SMH and UnitedHealthcare at odds on new Medicare Advantage contract
