Hospital Contract Non-Negotiations
Just a heads up on a topic that will be all too familiar going forward. We see this as a trend and not the exception. As hospital systems have consolidated in reaction to negative market condition and increasing costs of doing business. But size is better when it comes to negotiating with insurers. We are seeing profitable hospitals asking for 15% rate increase form prior years. They can do this because insurer network marketability is on the quality and size of network.
Current News:
Aetna: Effective 4/5/2010, Beth Israel Medical Center – Petrie Division, Beth Israel Medical Center – Kings Highway Division; Long Island College Hospital; New York Eye & Ear Infirmary; and St. Luke’s Roosevelt Hospital Center – Roosevelt Division, and St. Luke’s Roosevelt Hospital Center – St. Luke’s Division (the “Continuum Hospitals”) were terminated from the Metro NY Aetna network. The hospitals will remain participating and will be accepting In Network Rates until the end of the cooling off period on 6/5/2010.
Continuum had almost lost United/Oxford Health Net in march and Empire or Wellpoint last Spring.
Empire Effective 4/1/10 has lost Stellaris Health Network in Westchester. Those hospitals include Phelps Memorial, Lawrence Hosp, White Plains Hosp, and Northern Westchester Hosp. They were asking for double digit increases for each year of a mutli-year contract, which would have had to be passed on to our members in the form of higher premiums. Our Empire clients will be covered in those facilities for emergencies, as well as services that have already been pre-authorized and approved.
A released Empire Fact Sheet of the contract termination is available
While this happened somewhat in prior years things usually were worked out at 11th hour after a cooling of period. Whats troubling now is that there is little common ground to stand on. We believe in the short term they will get reworked as both Mammoth Corp need each other but this will be a serious concern worth watching.