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Insurers start to feel the contract-cutting heat

Per a Nov. 17 article in Kaiser Health News, some say reimbursement contracts fights are a ‘hardball tactic’ to boost payor profits.

In our opinion, hospitals usually bear more than their fair share of blame when insurers make cuts to their health plan networks. To be fair, not every hospital is always in the right – but insurers wield immense power in network negotiations, as a recent Kaiser Health News article acknowledges.

The article notes that tensions between payors and providers are growing, and an increasing number of reimbursement contracts end without a deal: “Even if they are eventually resolved, those terminations throw tens of thousands of patients into the difficult position of choosing between much higher out-of-pocket costs or leaving a trusted physician and hospital.”

It’s both a national and local trend, according to Beth Spoto, a Georgia-based health care consultant with Spoto & Associates. She tells KHN that, from the insurers’ point of view, it’s a hardball tactic to lower payment rates to medical providers for services.

Do Anthem and UnitedHealthcare dispute these charges? Not that we’ve heard, though they do note that “the large majority of contracts are renewed without public attention.” This is sort of like saying, “The large majority of planes land without crashing.” Right. That’s the way it’s supposed to work. And any exceptions are pretty darn important.

We’re not sure if the additional scrutiny will force payors to rethink their aggressive strategies, but we can only hope.

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