HARRISBURG, PA – UnitedHealthcare is the largest health insurance company in the United States. It insures more than 1 million people in Pennsylvania alone through individual, employer-sponsored, Medicaid, and Medicare benefits plans.
Due to an ongoing contract dispute between UnitedHealthcare and WellSpan Health, a substantial portion of those 1 million customers could soon find that their favorite doctors and hospitals are suddenly “out of network.” WellSpan Health, based in South-Central Pennsylvania, operates more than 250 hospitals and other patient care locations.
What does it mean when a health insurance company and a healthcare system find themselves locked in a contract dispute with no resolution in sight? abc27 news anchor Alicia Richards described it like this:
“Think of how upset you’d be when a channel you like to watch is suddenly unavailable. Now imagine something similar happening with your healthcare – which would be much more serious – and it could soon happen for some mid-staters.”
The current contract between these two companies ends on October 31. If they fail to reach a revised agreement, then beginning on November 1, WellSpan doctors and hospitals in Adams, Franklin, Lancaster, Lebanon, and York Counties would suddenly become out of network for people in Pennsylvania with UnitedHealthcare insurance plans.
Michael Seavers, P.D., MBA, MHA, MSCS, Program Lead for Health Informatics at Harrisburg University, joined abc27 hosts Alicia Richards and Seth Kaplan to provide a closer look at what the UnitedHealthcare vs. WellSpan Health contract dispute would mean for customers in Pennsylvania. If a deal falls through, he says, it means “higher prices for the consumer.”
Dr. Seavers continued, “There are three major things: cost, access, and quality.” Contracts between payers and health systems seek to balance these factors in a mutually agreeable way, while offering consumers choices that further refine that balance based on their needs. Prioritizing higher quality usually means higher costs.
Why are UnitedHealthcare and WellSpan still locked in this contract negotiation with the October 31 expiration date so close? Here they are in their own words:
According to United HealthCare, “WellSpan’s rates are egregiously high and are driving up the cost of healthcare for consumers in the region, yet the health system continues to seek significant rate increases that drive up its already high costs.”
“WellSpan says that’s not true,” said Seth Kaplan. “It says United is worse than its peers about holding up patient care.”
WellSpan said in a statement: “United has made the broad sweeping statement that WellSpan is significantly more expensive – which is simply not true. We must ask for reasonable rate increases to effectively meet the ongoing healthcare needs of the community and provide exceptional care that our patients have come to expect.”
“A lot of people say the negotiations between a payer and a hospital is like creating those balloons at the carnival,” said Dr. Seavers. “You squeeze one side to get the cost down, but the hospital asks for more money on the other side of the balloon.”
Constant advancements in modern medicine, he says, are part of the reason why costs continue to rise and contract negotiations are growing more contentious. “Hospitals have to have new technologies,” he observed.
Hospitals and insurers will sometimes agree to extend their old contract while they continue negotiating. But as Seth Kaplan pointed out, “It’s bad for everyone if things go south. [Dr. Seavers] says this is just the current stalemate. Next year, it could be United and a different healthcare system, or WellSpan and a different insurance company.”
You can watch the entire segment on abc27’s YouTube channel. And to learn more about Harrisburg University’s Master of Science in Healthcare Informatics degree program, be sure to visit HarrisburgU.edu.
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