Imagine for a moment that you are Mrs. Ida Jones. You are 68 years old and live with your husband in Tampa, Florida. Like many seniors in the area, you are enrolled as a member of the Medicare Advantage insurance plan through the company UnitedHealthcare, also known as the operating division of the single largest health carrier in the United States. UnitedHealthcare allows you to seek treatment and services at any hospital or physician's group associated with BayCare, the largest hospital group in the Tampa Bay area, which is quite convenient. If you, Mrs. Ida Jones of Tampa, Florida, are in need of a hip replacement surgery, the logistics of care and insurance is simple - you are covered financially by a health carrier that's supported and trusted by 7 million Americans, and your doctor belongs to a network of not-for-profit hospitals and outpatient services with more than 200 locations throughout Tampa Bay. Easy.
At least, it used to be easy. That smooth, behind-the-scenes networking between hospital and insurer came into an ugly spotlight earlier this year when UnitedHealthcare and the BayCare hospital group embarked on a very public dispute over money, care and financial transparency. The dispute came to a head just this week, when on Monday the 26th of November neither BayCare nor United had taken steps to resolve the argument, meaning that effective immediately, the contract between insurer and hospital has been terminated. United is no longer covering patients in the BayCare system.
This contract termination has big consequences for our Ida Jones and the nearly half a million Tampa Bay residents like her. Firstly, these residents must choose between their doctor, and their insurance company - if Mrs. Jones is quite happy with the doctor she normally sees at, say, Mease Countryside Hospital, she will need to find a different insurance plan immediately. For seniors especially, the trouble of sifting through a slew of new insurance options is quite unwelcome at this point in the year, what with holiday gatherings, travel plans, and barely a month left to make the all important decision about which Medicare coverage plan they will choose for 2013.
On the other hand, if Mrs. Ida Jones does not want the hassle of switching to another insurance company, she must leave behind the BayCare doctors and other care providers to whom she has become accustomed. If she stays with UnitedHealthcare, Mrs. Jones will lose access to many of the more than 200 hospitals and other facilities run by BayCare in Tampa. In fact, many United customers are signed on with the insurance company through their employer, and may have less choice in the matter of changing providers.
Hardly surprising that the estimated 400,000 Tampa residents affected by the BayCare/UnitedHealthcare dispute are feeling a bit uneasy this week.
But, what is this dispute really about? It began earlier this year when both BayCare and United asked for something the other organization wasn't willing to give: BayCare wanted $11 million in unpaid claims from United, and United wanted a justification from BayCare for costly rate increases for medical procedures. Both companies took out full page advertisements in the Tampa Bay Times, arguing their points for all to see.
In BayCare's full page ad, the hospital group explained that United had failed to make good on $11 million worth of legitimate claims for care provided. It's a huge sum of money, especially for a hospital system already taxed by its own size and scope, the rising price of care, and an uncertainty among doctors and administrators with regards to Obamacare and Florida governor Rick Scott's recently demonstrated interest in creating a state insurance exchange program.
UnitedHealthcare, on the other hand, argue that they have been responding to claims properly and paying more than enough money to BayCare. In a fact sheet released earlier this November, the company explains that BayCare already receives $330 million from United annually, and that the extra $11 million BayCare claims it is owed is due to costly rate increases which BayCare is wrong to impose in the first place. United claims that BayCare is falsely inflating the price of services and then passing the bill on to United, hurting the insurance company and patients in the process. For example, United calculates that with the rate increases BayCare is requesting, by next year a hip replacement surgery would cost $12,000 dollars more than the same surgery today.
BayCare has not taken kindly to these mathematical theories. The hospital system lashed out against United, calling the cost increase figures inaccurate, misleading, and ultimately manipulative to the patients United is supposed to serve.
It's an unfortunate situation where neither side is in the right nor the wrong, neither side is willing to back down, and the final burden is placed upon the patient. To their credit, both BayCare and United have made provisions to lessen negative effects on Tampa residents caught up in the dispute. Any pregnant woman already in the care of a BayCare physician will be able to deliver at a BayCare hospital with coverage from United as normal. Likewise, patients in the middle of a procedure or going through surgery aftercare will be able to complete their treatment. And, as mandated by federal law, any BayCare hospital will still accept patients with United insurance in the case of an emergency.
In the end, this bitter battle between a hospital group and a health insurance provider offers powerful insight into the multifaceted world of healthcare. Hopefully, this particular struggle will be a lesson on the importance of communication and working together to find common solutions to common problems, rather than a sorry example for other care providers to follow.