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Apr 9, 2010 1:16 PMPublication: The East Hampton Press

Alliance and Empire reach agreement; both sides say they're pleased

Apr 9, 2010 1:16 PM

The thousands of East End residents who are Empire BlueCross BlueShield subscribers can once again visit local hospitals to receive in-network care, thanks to a highly anticipated contract agreement reached last week.

The East End Health Alliance—Southampton Hospital, Peconic Bay Medical Center in Riverhead, and Eastern Long Island Hospital in Greenport—resumed operating within Empire’s network as of last Thursday, April 1, when the agreement between the three hospitals and the region’s largest health insurer was announced. The Alliance had been out of network with Empire since August 1. The new contract, which will extend until December 31, 2012, marked the culmination of a year-long negotiating process.

State Senator Kenneth P. LaValle, who has kept close tabs on the talks, called the agreement the “first big test” for the young hospital alliance, which formed a few years ago largely to gain bargaining power.

Details of the new contract have been kept confidential, although both sides said they are pleased with the outcome of the negotiations and that the reimbursement rates—the amount of money insurance companies pay hospitals and doctors for various types of care given to policyholders—have been brought up to market rate.

Robert Chaloner, president and CEO of Southampton Hospital, called the contract “fair” and said it was “worth the wait.” He also said that he expects Southampton Hospital to break even financially once final audits are completed in June and although the hospital did lose patients during the negotiations, and visits to the emergency room didn’t vary much, he expects some higher reimbursement rates during the impasse to compensate for that.

“All those elective procedures and routine procedures that you’ve put off, bring them on here now,” announced Paul J. Connor, spokesman for the Alliance and CEO of Eastern Long Island Hospital, at a Monday morning press conference at Peconic Bay Medical Center.

Both sides expressed relief last week that the impasse had finally been cleared, although they also acknowledged that drawn-out contract negotiations may be a thing of the future.

“It’s negotiations. At some point you have to agree,” Mr. Connor said shortly after the announcement last week. “You have to lay it against the backdrop of health care reform. Trying to predict the future of health care in three years is hard. Two years is hard enough.”

Mr. Connor credited U.S. Representative Tim Bishop of Southampton and Mr. LaValle for providing the grease to keep negotiations moving forward, particularly by keeping in regular contact with Mark Wagar, the president and CEO of Empire.

“It was a long battle, but financially it was worth it because without it we would be falling behind,” Mr. Connor added. “We now have market rates and we want our patients and physicians to resume their normal patterns of care they were used to before they went out of network. ... Patients can come back to their neighborhood hospitals.”

But Mr. Connor also issued a warning: “I believe we will see more tension between providers and payers because of how money is tightening up and costs are continuing to go up.”

Sally Kweskin, a spokeswoman for Empire, called the negotiations a constant “balancing act” between care and access. While “very pleased” with the agreement, she said, “Unless we control the cost of medical care, you’re never going to get an affordable premium and people are worried.”

The contract is particularly important locally as the number of health care insurance companies has dropped because of consolidation and not all insurers in New York have networks on the East End, said Anthony Cardona, a broker for Maran Corporate Risk Associates of Southampton. Mr. Cardona said a lot of his clients were holding out until a contract with Empire could be reached rather than switching to a smaller insurer, especially since business owners often make such decisions for their companies and opportunities for renewal often come up on an annual basis.

“It’s a choose-your-poison type of thing,” he added. “Just because Empire came back doesn’t mean there is a slew of options.” The other carrier in the small-business market, he noted, is EmblemHealth, which has a limited network. And the Alliance is now engaged in contract negotiations with CIGNA HealthCare and will be entering negotiations with United Healthcare Oxford shortly.

According to Ms. Kweskin, Empire did not suffer from a net loss in membership as a result of the contract hiatus, which she attributed to the majority of its subscribers consisting of municipalities, unions and other large groups that she said are “more focused on the overall value proposition we offer than temporary non-participatory status of specific facilities.”

At Monday’s press conference, Mr. Bishop touched on what he called a “collision” between two business models—not-for-profit hospitals and for-profit insurers—that he believes is incompatible.

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Has to be one of the best accidental Star Wars headlines ever...
By Oliver Peterson (19), Southampton Press on Apr 2, 10 1:04 PM
By Will James (4), Lake Grove on Apr 2, 10 3:27 PM
I still have issues with the CEO's multi-million dollar salary, but at least people can get care now.
In other countries, you can die waiting for care. Without insurance here, you can be ridden by debt to the grave.
By Mr. Z (11847), North Sea on Apr 2, 10 1:33 PM
What is the appropriate executive pay?
By RemembertheDucks (54), Eastport on Apr 2, 10 2:18 PM
If the CEO's salary is tied directly to denial of coverage and death to anyone not willing or able to pay yearly premium increases of 30 to 60% for decreased coverage then I would say $1.50/day for their entire prison sentence sounds about right.
By dagdavid (646), southampton on Apr 6, 10 1:17 PM
Hopefully, not roughly 50 times minimum wage per hour, as is the case here at over 3 million a year, last time it was made public.

That's a fact, no Polemics...
Apr 2, 10 2:54 PM appended by Mr. Z
If more than 40% of your company profits are payroll, maybe some of your people running the show make a little too much. I wonder what the percentage is with health insurers... I wonder what percentage
By Mr. Z (11847), North Sea on Apr 2, 10 2:54 PM
Maybe we could hire mr z as the next pay czar so he can dictate what salary people are entitled too
By razza5350 (1911), East Hampton on Apr 2, 10 7:33 PM
I don't know about a tsar, but, what I will say is that these types of excessive compensation are a big part of what has created the turmoil that exists today.

Take some time, check out "The People Speak...", and you may just find out how relative the experiences and words of the people years ago are, and differ very little today. You may even say, 'Hey, I've felt JUST LIKE THAT!".

In 5,000 years, Humanity basically has not changed, just the scenery...
Apr 2, 10 10:27 PM appended by Mr. Z
Remember, basic supply, demand, and scarcity. If some citdiot, or other idiot has half a mil, or better to spend on a house, some fool will ASK for half a mil, or better for a house. Via trickle down effect, the prices of ALL real estate eventually reach ridiculous price levels. Anyone who makes less than 50, or 60k, in their own hometown will most likely be priced out of the housing market. The main problem is self entitlement. "It, or me, is worth this much because I SAY it is.". The end result is what I have seemingly coined "de pecuniae" segregation. Segregation by way of the Almighty Dollar. Bow down before the ONE you serve, eh?
By Mr. Z (11847), North Sea on Apr 2, 10 10:27 PM
I do know that you should educate yourselves about some key people leading up to the crises in our markets. Health care, real estate, derivatives, and others. The key market was derivatives.
The first bailout was actually back in about 1996, and a financial institution called Banker's Trust was the beneficiary of that bailout. They were big in the OTC derivatives market.
Learn who Ayn Rand was, her direct influence on Alan Greenspan, and his belief that markets could self regulate, upon ...more
Apr 3, 10 1:53 AM appended by Mr. Z
Sorry, I meant PASSAGE of the GLBA, which repealed parts of the Glass Steagall Act of 1933, and changed the definition of a security.
By Mr. Z (11847), North Sea on Apr 3, 10 1:53 AM
I can just imagine how that last Empire board meeting went before the agreement. "Hurry up and make amends, with this new healthcare bill, EVERYONE has to purchase health insurance!! Get this done so we can get our 15 pieces of silver before we are run out of business altogether. GOD BLESS BARACK OBAMA!!"
By AlwaysLocal (292), southampton on Apr 4, 10 3:43 AM
Im sure thats exactly how it went. Thats why they decided to raise premiums on the people in Ca before the health care vote as well
By razza5350 (1911), East Hampton on Apr 4, 10 8:06 AM

They realized they had little time to continue abusing their capitalistic freedom, in a relatively unregulated market.

Once PROPER regulation is enacted, they will no longer be able to grossly profit at the expense of others. Nor, profit from other's misfortune.
By Mr. Z (11847), North Sea on Apr 4, 10 12:38 PM
Unfortunately, Mr Z, this bill offers no "PROPER" regulation. This bill is not aimed to correct the insurance companies greed, rather than run them out of business as punishment for previous flaws. This WILL lead to the gov't run healthcare industry, and IMO the gov't can't even run much less complex systems (such as the post office) so why should any of us have faith in them running the most complex industry in the world?
And, make no mistake, the gov't will eventually take over any industry ...more
By AlwaysLocal (292), southampton on Apr 8, 10 4:23 AM
If not for the for-profit Alliance corporate structure, this agreement would have been concluded before the former expired. Here's a comment I posted on the opinion thread about the new universal health insurance bill:

The answer to ignorance is knowledge. If you truly believe that US health care compares favorably with other Western industrialized nations, (from whom we draw our heritage), just read the book I cited, "The Healing of America", by T.R. Reid.

The specters that ...more
By highhatsize (4217), East Quogue on Apr 4, 10 3:33 PM
[Edit: I should have said, "for-profit EMPIRE corporate structure", in my first sentence.]
By highhatsize (4217), East Quogue on Apr 5, 10 6:31 PM
Isn't JR Reid a left wing kook who was ostracized from frontline for misrepresentation? Reid is a journalist, Princeton grad elite who never served in the private sector. His wife is a lawyer. He would be better of writing an article on how we need legal reform in this country. At least he would be more qualified to write that piece
By razza5350 (1911), East Hampton on Apr 4, 10 7:42 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By highhatsize (4217), East Quogue on Apr 5, 10 2:34 AM
to razza5350:

I have no idea who JR Reid is.

However, I assume that you are confusing him with T.R. Reid whose character you assail for being a journalist, Princeton grad, and an
elitist, besides having a lawyer for a wife!!

Why not just call him a big dummy and leave it at that.
By highhatsize (4217), East Quogue on Apr 5, 10 2:34 AM
I never said he was a big dummy. He is a journalist nothing more. He is an expert in nothing. You said the answer to ignorance is knowledge. You also site this guys book as though it's the holy grail of health care reform books and quote it's like the bible.
By razza5350 (1911), East Hampton on Apr 5, 10 7:04 AM
I take one thing back. I use the word journalist loosley. Anyone who misrepresents themselves is writing editorials. He is much a journalist as as fix and msnbc are news stations
By razza5350 (1911), East Hampton on Apr 5, 10 7:06 AM
to razza5350:

- - - or, you could READ THE BOOK and comment on its contents rather than on the author's disreputable status as a Princeton grad, journalist and husband of a lawyer. It DOES contain hundreds of verifying footnotes. You
COULD check out a few to see if he is really just a JOURNALIST. (When did that become a synonym for stupidity and ignorance?" Journalists and their publishers can be sued for big bucks if they publish false information.)

Or, you could continue ...more
By highhatsize (4217), East Quogue on Apr 5, 10 11:51 AM
My intention was to show that he is not an expert. I did Google him and it read that he never served in the health care field. He never served in the private sector? His degree at Princeton was in Classics. What classifies his as an expert. My point is what has he done that would warrent you treating him like the be all end all on health care?

By razza5350 (1911), East Hampton on Apr 5, 10 1:04 PM
to razza5350:

YOU set up the straw man of "expert" and then shoot him down because you don't consider that his bonafides merit the title. Woodward and Bernstein weren't burglars but they, nonetheless, exposed Watergate. That's who writes most exposes - journalists.

The reason that I find him to be convincing is, to state it once again, I READ HIS BOOK. If you don't want to read his refutations of your misconceptions, don't. But your discrediting him as a mere journalist is ...more
By highhatsize (4217), East Quogue on Apr 5, 10 2:42 PM
So its Ok to bash almost every profession but Journalists is that it? Are you a journalist? How do you think people in the evil for profit insurance business, Physcians, medical device manufacturers and pharmacutical world feel when HE makes derogratory comments about THEIR professions. You don't like it when the shoe is on the other foot do you? I am not bashing Journalists but I have a problem with ones who promote an Agenda. If you listen to him speak it will not take you long to figure out ...more
By razza5350 (1911), East Hampton on Apr 5, 10 3:37 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By highhatsize (4217), East Quogue on Apr 5, 10 4:05 PM
to razza5350:

I don't believe, nor have I ever indicated, that insurance executives, physicians, medical device manufacturers, and Big Pharma are evil. That's ridiculous.

Furthermore, your fulminations about what TR Reid has supposedly said reveal that you have no conception of the subject matter of the book. If you did, you would realize that Mr. Reid speaks fairly and often fondly of all the above trades.

If you are loath to contribute to Mr. Reid's well-being, don't ...more
By highhatsize (4217), East Quogue on Apr 5, 10 4:06 PM
In the videos I saw if he was speaking fondly of the private industry I would hate to see how he speaks of something he despises. I also look at medicare and medicaid ripe with Fraud, mismanagement, and riddled with debt as our prime examples of non for profit administrators and cringe. Bottom line is I respect your opnion but disagree with you. Have a nice night.
By razza5350 (1911), East Hampton on Apr 5, 10 7:38 PM
Near as I can gather, Mr. Reid felt the documentary undermined the values, and opinions presented in his book. PBS asked him to do the doc, and then disagreed with him when they wanted their "fair and balanced view".
As someone educated in the Classics myself, though not to the extent of Mr. Reid, I can say that learning thousands of years of History, learning the daily life of those who came before us great and small, indeed grants you a broader perspective of the world, and society.
Mr. ...more
By Mr. Z (11847), North Sea on Apr 5, 10 9:46 PM