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Aug 26, 2009 1:47 PMPublication: The East Hampton Press

Empire, hospitals still at impasse, but issue affecting seniors has been resolved

Aug 26, 2009 1:47 PM

Empire Blue Cross Blue Shield and the East End Health Alliance remain locked in a battle over reimbursement rates in Empire’s other health care plans, but on Tuesday evening the two sides arrived at a verbal agreement over terms in Empire’s Medicare supplemental insurance plan.

The agreement regarding Empire’s Mediblue plan marks the first settlement since Alliance member hospitals—Southampton Hospital, Peconic Bay Medical Center in Riverhead, and Eastern Long Island Hospital in Greenport—went out of Empire’s network on August 1.

The agreement, which will allow seniors to use Mediblue insurance at Alliance member hospitals, is effective immediately, said Peconic Bay Medical Center spokeswoman Denise Civiletti.

“It’s the first piece of the puzzle, which is a good thing,” Ms. Civiletti said. “The Alliance is happy with this settlement.”

Empire spokesman Craig Andrews said hospital and insurance officials will “dot the I’s and cross the T’s” in the agreement over the coming week. Nearly 19,500 seniors in Suffolk County subscribe to the plan, he said.

“This is really to fix the situation with seniors, because it’s a convenience issue,” Mr. Andrews said. “I think it’s a good sign that the conversations are being productive.”

Empire and Alliance officials met at New York Department of Insurance offices in Manhattan on Wednesday morning to continue contract negotiations. The contract impasse between Empire and Alliance entered its fourth week on Monday.

The negotiations, which began in May, center on how much money Empire pays the hospitals to treat its patients. Alliance has argued that Empire must raise its reimbursement rates to levels comparable with other insurance companies in the region. Empire has argued that higher rates would result in higher premiums for subscribers.

Hospital officials on Monday gave no sign of backing down. Alliance Board of Trustees President Stephen Shapoff said higher rates are necessary because Empire pays hospitals so little that Alliance hospitals actually lose money by treating Empire subscribers.

“Blue Cross Blue Shield reimburses our doctors and our hospitals at about half the rate of all the other insurance companies, and that is what we are trying to attack,” Mr. Shapoff said. “We lose money on every Blue Cross Blue Shield subscriber that we see.”

Empire has argued that Alliance is asking for unreasonable rate increases of 40 to 60 percent above the rates established in the expired contract, which was agreed to in May 2008. Mr. Andrews declined to comment on Empire’s reimbursement rates and noted that both sides are observing a “quiet period” as negotiations continue. “Everybody is focused on negotiations,” Mr. Andrews said. “The conversation continues.”

Negotiation teams for Alliance and Empire typically communicate three times a week via telephone, and throughout the week by e-mail, Alliance spokesman Paul Connor III said. Alliance’s three chief fiscal officers, from each of its three member hospitals, make up the Alliance team while the Empire team is comprised of senior staff and network managers, officials said. The last telephone conference was held on Friday, August 21, and lasted for several hours, according to Mr. Connor.

“There is a lot of contact between the two parties,” he said. “That’s important for us to be able to find a solution.”

East End Alliance Board of Trustees 2nd Vice Chair Dr. Jesse Goodale III said trustees get updates twice a week about the negotiations. The board is responsible for approving a new contract between Alliance hospitals and Empire.

It is unclear when, if at all, an agreement will be reached, Dr. Goodale said.

Empire “is behind other health care companies that we have agreements with,” Dr. Goodale said. “Our hope is that this will be resolved sometime soon.”

With the hospitals and Empire unable to reach an agreement, Empire subscribers have been unable to use their insurance at Alliance hospitals for anything other than emergency and maternity care services and pre-approved procedures and treatment. Most others are having to travel to hospitals within Empire’s network, such as Brookhaven Memorial Hospital Medical Center in East Patchogue or Stony Brook University Medical Center.

If a deal is not hammered out, East End doctors who have admitting privileges only at Alliance hospitals will likely also go out of Empire’s network starting on September 29, unless they apply for and receive a 60-day extension. That means many Empire patients on the East End will also have to find new doctors.

Some local doctors say they are not seeking admitting privileges to hospitals within Empire’s network—which are fairly far afield for local doctors—and are instead waiting to see if an agreement is reached.

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The time for "lamenting" is over - we need ACTION NOW by our local representatives to end this stalemate. Don't just threaten to have the state and federal regulatory officials investigate - get it done!!! We who live on the East End deserve to be able to go to our local hospitals, rather than traveling an hour to reach one, and to keep our local doctors, rather than having to find new ones who have admitting privileges to Empire in-network hospitals. I'm disgusted.
By utahgirl1970 (8), East Hampton on Aug 26, 09 9:46 AM
Come on Mr Bishop - we need action now, not political pondering ! Show us what you can do !!
By Bill in Riverhead (190), Riverhead on Aug 26, 09 9:58 AM
a hack politician has no right getting involved in a negotiation that is legally being carried on between two private institutions. perhaps your mommy can help you....
By thetruthhurts (21), southampton on Aug 26, 09 10:22 AM
1 member liked this comment
Representative Bishop, let's begin much needed health care reform right here at home. Start a state and federal investigation of Empire's business practices. Stand up for patients. Empire's sole motivation is profit and they will only act if forced to act.
By dagdavid (646), southampton on Aug 26, 09 2:43 PM
I think Mr. Bishop is a BS artist, he has done nothing to help us with this problem.
By nurse (53), sag harbor on Aug 31, 09 9:29 AM