Nemours, UnitedHealthcare at contract impasse

An impasse in contract negotiations may sever the partnership between Nemours/A.I. duPont Hospital for Children and insurer UnitedHealthcare when the current contract expires April 1.

UnitedHealthcare has sent that notice to Nemours, hospital officials say, a move that could affect health care for at least 39,000 kids now covered by United through the state’s Medicaid program, the Children’s Health Insurance Program and commercial policies.

United is one of two managed-care organizations under contract with the state to provide care to kids covered by Medicaid and the Children’s Health Insurance Program. The other is Aetna-owned Delaware Physicians Care Inc. Both have covered services at Nemours, but that may change April 1 when UnitedHealthcare’s contract expires.

State officials said Monday that 33,000 children now get Medicaid/CHIP coverage through UnitedHealthcare and they have made arrangements to ensure that those children will be able to change insurers as early as March 1 if they want to receive care at Nemours.

“We’re not happy about this,” said Steve Groff, director of Medicaid and Medical Assistance for the state’s Department of Health & Social Services. “We’d prefer to see Nemours in both provider networks.”

Nemours spokesman Chris Manning said almost 6,000 children with a commercial UnitedHealthcare plan were seen at Nemours between 2011-2013.

“United has alternative pediatric providers available for their members,” Groff said, “but we recognize that Nemours has a very large footprint in Delaware and plays a unique and vital role in meeting the health care needs of children in the state. We want to be out front, ensuring that the necessary procedures are in place for that continuity of care. We don’t want people to be taken by surprise.”

Lt. Gov. Matt Denn said the state will be “very disappointed” with both companies if they can’t reach a deal.

“We think the dispute is one that can be resolved with both addressing their business concerns,” Denn said, “and we’re hopeful they will resolve it. That’s the best thing for Nemours and the best thing for United and – most important – that’s the best thing for kids who get health care there.”

Both companies issued statements that they have negotiated in “good faith” – to no avail.

“Unfortunately, United’s proposed contract terms were financially unsustainable and jeopardized our ability to continue providing high-quality care for children and families,” said Dr. Roy Proujansky, chief executive of Nemours’ Delaware Valley operations, in a prepared statement. “We are focused on finding a solution that preserves our ability to provide the unique levels of care upon which our reputation has been built.”

“We are disappointed that despite our good-faith efforts as of today’s date, we have not been able to reach a new agreement with Alfred I. duPont Hospital for Children and Nemours physicians,” said Mary McElrath-Jones, UnitedHealthcare spokeswoman, in a prepared statement.

People who are eligible for Medicaid coverage – funded by tax money from the state and federal governments – can enroll at any time they become eligible. Changes in insurers usually are only allowed in May – except when a major change occurs.

If Nemours is no longer in UnitedHealthcare’s network, that would would qualify as a major change, Groff said, and unless some settlement is reached “very, very soon,” letters notifying all policyholders must go out “very, very soon,” he said.

UnitedHealthcare has been under contract with the state to provide managed care since 2007.

The state last week issued new requests for proposals on all managed care contracts, Groff said.

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