Update: ECHN Dumping United Healthcare/Oxford

Eastern Connecticut Health Network announced today that it is terminating its provider contract with United Healthcare/Oxford health plans effective Oct. 15.

ECHN officials made the decision based on "inadequate reimbursement for care," according to a news release.

Meanwhile, insurance company officials say they want a new contract and want one before Oct. 15.

When the agreement expires, it means that patients with United or Oxford commercial insurance, including Golden Rule and Definity Plans, will be affected, according to the ECHN release.

Termination the contract does not affect patients covered under any Medicare Advantage plan, such as Secure Horizons, Evercare, AARP Medicare supplemental plans or any other Medicare plans, ECHN officials said.

“After many months of discussion, we have not received any reasonable contract proposal from United/Oxford that ensures adequate reimbursement for the care our health system provides to its members,” Michael Veillette, ECHN's senior vice president for finance and Information services, said in the release.

UnitedHealthcare spokeswoman Anayo Afolabi painted a different picture.

"We made multiple attempts over the last four years to engage the hospital in negotiating rate increases. However, Eastern Connecticut Health Network refused to meet with us,'' Afolabi said Tuesday. "The hospital system's unwillingness to sit down at the table with UnitedHealthcare for the last several years should not justify a sudden, significant increase on Connecticut residents and employers, especially considering UnitedHealthcare pays ECHN reimbursement rates at, or above the market average for some of its services."

Veilette said in the release that ECHN has not seen a rate increase from United/Oxford since 2003, which has led to ''payment rates that are well below the market.''

''We cannot allow the quality of patient care to suffer by agreeing to these rates, and unless United/Oxford changes its position, we find no other alternative but to end our relationship with them,'' Veilette said. 

Afolabi said ECHN is asking for an increase of more than 250 percent regarding increases for many of its services.

"For example, if we agreed to these rates some members would go from $3,500 to $8,840 to deliver a baby. If we agreed to these rates, this will cause a visit to the emergency room to increase from $480 today compared to $1,252 proposed,'' she said. "Local employers have asked us to negotiate on their behalf to contain medical costs as these high fees can pose a burden and put local businesses at a competitive disadvantage."

ECHN officials said they are ''committed to providing the highest quality of care to its patients at the lowest possible cost.'' Company officials claim that the two ECHN hospitals ''treat all who seek care regardless of ability to pay, 24 hours a day, seven days a week year-round.''

According to the release, Manchester Memorial Hospital and Rockville General Hospital combined to provide $14 million in uncompensated care.

“Given the slowdown in our national economy, we see this number rising over the next two years,” Veillette said.

''Much like everyone else, ECHN is concerned about the cost of health care and has controlled its costs by reducing expenses. MMH and RGH are two of the state’s high quality/lowest cost hospitals according to the data from Connecticut’s Department of Public Health, Office of Health Care Access," according to the release

''What the community needs to understand is ECHN is a not-for-profit healthcare provider. The slight net revenues it gains are reinvested back into the health system to provide safe and quality care to its patients. Below-market reimbursement rates from large, out-of-state, and for-profit insurers, such as United/Oxford, limit both hospitals’ abilities to remain current in today’s dynamic healthcare environment,'' according to the release

Over time, ''inadequate reimbursements'' can affect the quality of patient care, which is ''absolutely unacceptable,'' ECHN officials said.

“We will not offer our patients less than high-quality, compassionate health care,” Veillette said. “It is unfortunate that United/Oxford seems reluctant to recognize hospitals that have contained their costs, and yet it is willing to enable higher cost hospitals by providing much higher rates than those offered to ECHN.”

ECHN’s margins are reduced by reimbursements by Medicare and Medicaid that do not cover the costs of providing care. The additional burden of the recently imposed hospital tax by the State of Connecticut is further draining hospital revenues, ECHN officials said.

ECHN will continue to provide emergency care to all United Healthcare or Oxford Health Plan members, and those with out-of-network benefits may continue to access the network for all other services.

UnitedHealthcare's Afolabi said, ''We hope that Eastern Connecticut Health Network shares our commitment to reaching a new contract before the Oct.15 deadline. Our focus is on offering reasonable rates that will not put an unnecessary cost burden on consumers during these difficult economic times. We are also mindful of Eastern Connecticut Health Networks need to be competitive with other health systems in the state."

ECHN is registered as a not-for-profit health care system. It serves 19 towns in Eastern Connecticut.

Its list of affiliates includes:

• Manchester Memorial Hospital.
• Rockville General Hospital.
• Woodlake at Tolland Rehabilitation and Nursing Center.
• The ECHN Medical Buildings at 2400 and 2800 Tamarack Ave, Evergreen Walk in South Windsor.
• A partnership with Visiting Nurse & Health Services of Connecticut Inc.
• Connecticut Occupational Medicine Partners Inc.
• Ambulance Service of Manchester.
• Aetna Ambulance.
• Metro Wheelchair, and Saint Francis Care (which partners with ECHN on the Cardiac Catheterization Laboratory of the Hoffman Heart Institute of Connecticut at Rockville General Hospital).
• Community CancerCare Inc. (which provides radiation therapy services at the Eastern Connecticut Cancer Institute at The John A. DeQuattro Cancer Center in Manchester).
• Evergreen Imaging in South Windsor.
• Tolland Imaging Center.
• An affiliation with Connecticut Children’s Medical Center.