Dispute between hospital and insurer could force thousands to change doctors

Stalled contract negotiations between UnitedHealthcare, the health insurer, and Mount Sinai Health System, a leading hospital system in New York City, are forcing tens of thousands of New Yorkers to switch doctors or risk paying out-of-network prices.

The impasse has been dragging on for months. Mount Sinai has tried to raise prices significantly, but the insurance company has refused to agree to pay the new proposed rates. As a result, Mount Sinai hospitals are now out of network for patients insured by UnitedHealthcare of Oxford, subsidiaries of the same company.

But the issue is about to become even more pressing for many patients, as many Mount Sinai-affiliated physicians — in addition to the hospitals themselves — will be removed from UnitedHealthcare’s network starting March 22. That means United patients on employer-sponsored or individual plans will be charged out-of-network rates when they see a Mount Sinai-affiliated physician in a doctor’s office.

The negotiations have caused many patients to look for new doctors. UnitedHealthcare says about 80,000 patients at Mount Sinai are affected.

What happened?

The dispute between the insurance giant and the hospital system is a rare example where health care contract negotiations have entered the public spotlight.

Mount Sinai tried to negotiate better rates with UnitedHealthcare, demanding that the insurance giant pay the hospital more for doctor visits and hospital stays. United claims Mount Sinai asked for fare increases approximately 58 percent in the next four years.

Mount Sinai says it requested a significant increase because it recently learned that UnitedHealthcare paid Mount Sinai significantly less per medical procedure than other top hospitals in New York City.

Mount Sinai estimates that another hospital system, NewYork-Presbyterian, receives about 40 percent more from UnitedHealthcare than Mount Sinai for common procedures.

Hospitals and health insurers negotiate rates individually within the network. Prices were often treated as secret, and hospital administrators often had only a vague idea of ​​what insurance companies were paying their competitors for similar care. But that has changed due to recent legislation that required hospitals to publish information about rates.

“It’s something we thought about for years by talking to colleagues from other institutions, but we were able to prove it in 2023 thanks to the new transparency laws,” said an obstetrician-gynecologist at Mount Sinai, Dr. Alan Adler, who was involved. in negotiations with United.

That set the stage for the current dispute: Mount Sinai wanted United to pay them more in line with the competition, while United wanted to keep costs low. It mentions the hospital network requirements “bizarre.”.

In a statement, UnitedHealthcare said the two sides were in “active discussions” and that it had “provided the health care system with multiple proposals that include meaningful rate increases that will ensure they continue to be reimbursed at market rates.”

Brent Estes, a senior vice president at Mount Sinai, said United “offered us virtually nothing more than the previous contract.”

“Unfortunately,” he added, “we are bracing for our physicians to be out of network.”

What consequences can patients experience?

Doctors say the situation is particularly stressful and confusing for New Yorkers receiving cancer care at Mount Sinai or who were planning to give birth there. While such patients may be eligible to stay with their doctor without paying more, getting clear answers is difficult.

For example, a pregnant woman received a letter from UnitedHealthcare last month stating that she would still be eligible for in-network at Mount Sinai when it came time to deliver her baby. But the letter, provided to The Times by a Mount Sinai employee with the patient’s name redacted, stated that in-network coverage had been approved in April for a three-day period — apparently corresponding to her due date — and only concerned ‘routine problems’. obstetric care” and a vaginal delivery.

The letter said nothing about what would happen if she went into premature labor or needed a caesarean section. A UnitedHealthcare spokesman, Cole Manbeck, said some of the insurance company’s automated letters “may have caused a little confusion.” But Mr Manbeck said United had made phone contact to clarify that delivery would be covered regardless of date or method.

Many other hospitals in New York City remain within UnitedHealthcare’s networks, including NewYork-Presbyterian, the city’s largest private hospital system.

Chris Pope, a health care policy analyst at the Manhattan Institute, a conservative think tank, said the insurer likely had the upper hand in the negotiations because United patients could simply move their care to other health care systems, leaving Mount Sinai with much less income was left behind. said.

“United can walk away from Sinai much more easily than Sinai can without United,” he said. “So Mount Sinai will be in big trouble if United doesn’t ultimately agree to allow patients to go there again.”