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Aug 4, 2009 6:14 PMPublication: The East Hampton Press

Hospitals and insurer fail to reach agreement; Empire not accepted at East End hospitals

Aug 4, 2009 6:14 PM

Having failed to reach a new contract agreement before the midnight deadline last Friday, the three East End hospitals are no longer part of Empire Blue Cross Blue Shield’s network, meaning Empire insurance will no longer be accepted at the hospitals in most circumstances.

Negotiations between the East End Health Alliance—which includes Southampton Hospital, Peconic Bay Medical Center in Riverhead, and Eastern Long Island Hospital in Greenport—and Empire, the region’s biggest health insurance company, resumed this week. The dispute is over reimbursement rates for medical procedures performed at the hospitals. Until a new deal is in place, the hospitals are considered “out of network” by Empire.

While out of network, Empire policyholders who have medical emergencies will not be turned away from the hospitals as a result of the stalemate, but Empire insurance will not be valid for non-emergency and planned visits.

The Alliance had scheduled a press conference with state legislators in Riverhead on Friday to pressure Empire to be more receptive to the medical facilities’ contract offers, indicating that hospital officials expected the impasse to continue without resolution at least through the end of the week. But on Tuesday, the Alliance announced the press conference was being postponed indefinitely, and both Empire and the hospitals were observing a “quiet period” as long as they remain at the negotiation table and would not be making any more statements to the press.

East End doctors also risk being dropped from Empire’s network if they have admission privileges only at Alliance hospitals. They are facing a September 29 out-of-network deadline if Empire and the Alliance do not strike a new deal before then. The doctors may appeal for a 60-day extension, giving patients a total of four months to find another doctor, and doctors the time to gain admission privileges at a hospital within Empire’s network.

It is unclear how many doctors and patients the negotiations affect. Empire spokesman Craig Andrews said the company does not reveal that level of detail about its membership or provider network. But during a press conference last month held at Southampton Hospital, U.S. Representative Tim Bishop said that approximately 40 percent of patients of the three Alliance hospitals are covered by Empire insurance.

The roster for Friday’s postponed press conference had included State Senator Kenneth P. LaValle and State Assemblymen Fred W. Thiele Jr. and Marc S. Alessi.

The Alliance hospitals and Empire have been in contract negotiations for months, seeking a new agreement that sets the rates at which the hospitals are reimbursed for treating Empire policyholders. The hospitals are seeking to be paid what officials call the “market rate” for care—the rate other major insurers pay the medical facilities.

“Why do East End hospitals have to give Blue Cross a discount?” Alliance spokesman Paul Connor III said this week. He has said the hospitals actually lose money on each Empire patient they treat because of low reimbursement rates.

Empire spokespeople say the hospitals are seeking a rate increase in excess of 50 percent, and that would mean higher insurance premiums for policyholders.

With the two sides at loggerheads, Empire policyholders will remain out of network indefinitely. “We are prepared to go out for as long as it takes to get a fair contract,” Mr. Connor said.

He pointed out that this is the first time the Alliance, which was formed last year to cut costs and increase clout in negotiations with insurance providers, has been to the table with Empire.

Last year, Southampton Hospital and Eastern Long Island Hospital negotiated with Empire as a pair for a one-year contract. Peconic Bay Medical Center in Riverhead was excluded from those negotiations because it had a contract with Empire through a partnership with Stony Brook University Medical Center.

With all three East End hospitals now together, officials anticipated they could command higher reimbursements from Empire.

Mr. Connor pointed out that around 1999, when the East End hospitals operated under now-defunct parent company Peconic Health Corporation, they went out of network with Empire for about a week. He said it was not disastrous, and the president and chief operating officer of Blue Cross Blue Shield personally came to the East End in a limo to sign a new deal.

“Blue Cross was a different operation then,” he added. “It was a non-profit.”

“We are very disappointed that the East End Health Alliance would not negotiate beyond their request for a 50-plus-percent increase for just the first year of a renewal agreement ...” Mr. Andrews wrote in an e-mail Friday night. “We will continue to keep the lines of communication open and hope that EEHA will work with us to reach an agreement that will allow our members to access their services at rates they can afford.”

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Wow, glad I don't work in the ER this weekend!
By barnbabe (64), westhampton beach on Jul 31, 09 10:05 PM
Clearly time for the public option folks! Just about every state, city and local worker elects Empire so now, effectively, they have no coverage at all. They paid premiums for nothing.
By lulubelle1956 (24), Westhampton Beach on Jul 31, 09 10:54 PM
By pinga (90), hamptonbays on Aug 1, 09 8:01 AM
First they decrease coverage and increase the copay by 50%, now we can't use any of the local hospitals. Why should I continue to pay for coverage I don't have ! All policyholders including their employers in the area, should receive a rebate for the period of time they have no coverage.
By graibierd (6), Southampton on Aug 1, 09 1:28 PM
Wasn't Representative Tim Bishop going to do something about this?

Or was that just one of his press releases?
By Frank Wheeler (1826), Northampton on Aug 1, 09 6:36 PM
1 member liked this comment
This is why we need single payer in this country. We won't get that this way around, but maybe we'll get a robust public option.
By peoplefirst (787), Southampton on Aug 1, 09 7:21 PM
1 member liked this comment
This does not petain to town o village employees...they have The Empie plan which is United Healthcare NO Empire BCBS. otally diffeent. Don't start a panic with wrong info!!!!
By squeaky (291), hampton bays on Aug 1, 09 7:29 PM
1 member liked this comment
OMG! my keyboard is sticking! The EMPIRE PLAN is NOT BCBS! Its Empire BCBS that is in trouble here not the town and village insurance.
By squeaky (291), hampton bays on Aug 1, 09 7:31 PM
This is a phenomenon upon which to construct a new paradigm of health care for the East End. The Alliance will, according to the article, continue to provide care for Empire BC insureds in emergency cases. Thereafter, one assumes, they will be transported to a hospital further west for continued, non-emergency care.

Why not make this system permanent? Downscale the three Alliance hospitals so that they are just emergency trauma centers and build a modern regional medical center for the ...more
By highhatsize (4217), East Quogue on Aug 1, 09 11:06 PM
By sjk631 (1), east hampton on Aug 2, 09 8:13 AM
Sorry Squeaky but you are wrong on The Empire Plan. The Emipre Plan is United Heathcare for Dr. visits but it is BCBS for hospital care. So empire Plan patients are in the same situation except that they have out of network benefits and will need to pay their deductibles before the insurance kicks in.
By Medical Biller (1), Hampton Bays on Aug 2, 09 9:38 AM
1 member liked this comment
go to any city, town or village in america. the people that depend on the governement for everything, including healthcare are less healthy and worse off than the folks that take care of themselves. so if a little healthy negotiation throws you off to the point where you want to sign off your and your family's personal freedoms to the THE MAN, go ahead, but leave me out of it.
By thetruthhurts (21), southampton on Aug 3, 09 7:11 AM
These hospitals have the power and don't realize it? Empire CANNOT sell their product on the East End if the hospitals refuse to accept them, so Empire must negotiate in good faith. Empire is not the only insurer on the East End...how about Oxfort, GHI, Aetna, CIGNA, Island Group, HIP??? And, please, don't start with the one payor system. The government can't get Medicare right or the auto and bank bailouts...and you want to trust our healthcare system to them?!
By nauti lady (25), Sag Harbor on Aug 4, 09 12:10 PM
Single payer health care and publicly funded elections
By peoplefirst (787), Southampton on Aug 4, 09 2:57 PM
Greed, greed, greed, avarice, and the price of malpractice insurance.

What does the hospital's CEO get a year, 3.5 million at last public mention.

Most of the problem is the jokers who run these outfits.
By Mr. Z (11847), North Sea on Aug 4, 09 7:17 PM
1 member liked this comment
For our elucidation, Alliance could publish the reimbursement rate that it is requesting for certain well-known procedures and the rate that Empire is willing to pay, together with the rate it pays Brookhaven. That would give us an idea of how far apart and how reasonable both sides are.
By highhatsize (4217), East Quogue on Aug 4, 09 7:29 PM
Squeaky - Empire is Blue Cross Blue Shield For Town, County and State Employees.... United Health Care pays your doctor. Blue Cross pays the Hospital. I see someone else already corrected you...

Empires reimbursement rates are to East End Hospitals is riduculously low. Look at EOB when they come in the mail and see how much they pay to the hospital for your procedure or ER visit. The amount that is not covered is ridiculous. No wonder our local hospitals are in such financial turmoil.
By newsgeek (3), East Quogue on Aug 4, 09 10:53 PM
1 member liked this comment
1. The Hospital is still in negotiations with Blue Cross
2. You can still go to the Hospital for emergency care
3. Most doctors are still contracted with Blue Cross until Oct.1
4. Blue Cross is NOT United Health Care (they are parent company of Oxford)
5. If you have the state, county or medicare plan you are unaffected (sorry EH Town)
6. If you need elective surgery you can call Blue Cross and request that it be treated in network if you do not have a facility within a certain ...more
By razza5350 (1911), East Hampton on Aug 6, 09 9:42 AM
1 member liked this comment
I work for the county & yes WE ARE affected!!!!!
By reddawn4125 (1), Riverhead on Aug 6, 09 10:42 AM
to all civil service employee's status of hospital negotiations.Empie bluecross blueshield's [ebcbs]contracts with certain hospitals located in suffolk county are due to expire effective 8/01/09.east end health alliance[eeha]is comprised of eastern long island hospital,peconic bay medical center and southampton hospital.to date,negotiations with eeha have been unsuccessful.effective 8/01/09 eeha facilities will no longer be network facilities under the empire plan hospital program.information on ...more
By asurest (117), easthampton on Aug 6, 09 7:14 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By dagdavid (646), southampton on Aug 7, 09 8:06 AM