Morgan Haefner – September 4, 2019
A contract dispute between UnitedHealth Group
and physician staffing company TeamHealth could indirectly affect hospitals and
other providers, according to credit rating agency Moody's Investors Service.
UnitedHealth is set to end high-reimbursement
in-network contracts with TeamHealth. The change would take effect between Oct.
15, 2019, and July 1, 2020, and affect contracts across 18 states. Earlier in
2019, UnitedHealth reduced TeamHealth's reimbursements for certain
out-of-network claims by about 50 percent, prompting TeamHealth to sue UnitedHealth
in eight states, according to Moody's.
To understand the implications of UnitedHealth's feud with TeamHealth, Moody's analysts examined a similar dispute between Nashville, Tenn.-based Envision Healthcare and UnitedHealth. In the end, Envision agreed to lower reimbursements, resulting in an earnings decline for Envision. Moody's estimates TeamHealth's revenue would decline if it too agrees to a lower rate.
Notably, Moody's said by canceling higher-rate in-network contracts, UnitedHealth would essentially lower median reimbursement rates in certain areas. As current proposals in Congress aim to address surprise medical bills by paying out-of-network providers a median or market rate based on in-network rates for providers in the same area, lower rates from UnitedHealth would pull down the median industrywide.
Additionally, increased pressure on physician staffing companies like TeamHealth would indirectly affect hospitals, Moody's says. Should staffing companies receive lower reimbursements from payers, the firms would likely seek higher subsidies from hospitals.
"Disagreements between insurers and staffing companies could also disrupt hospitals if staffed physicians are no longer in-network. Unless legislation to curb surprise billing is implemented, patients could be on the hook for out-of-network charges, raising reputational and social risk for hospitals," Moody's said.
To understand the implications of UnitedHealth's feud with TeamHealth, Moody's analysts examined a similar dispute between Nashville, Tenn.-based Envision Healthcare and UnitedHealth. In the end, Envision agreed to lower reimbursements, resulting in an earnings decline for Envision. Moody's estimates TeamHealth's revenue would decline if it too agrees to a lower rate.
Notably, Moody's said by canceling higher-rate in-network contracts, UnitedHealth would essentially lower median reimbursement rates in certain areas. As current proposals in Congress aim to address surprise medical bills by paying out-of-network providers a median or market rate based on in-network rates for providers in the same area, lower rates from UnitedHealth would pull down the median industrywide.
Additionally, increased pressure on physician staffing companies like TeamHealth would indirectly affect hospitals, Moody's says. Should staffing companies receive lower reimbursements from payers, the firms would likely seek higher subsidies from hospitals.
"Disagreements between insurers and staffing companies could also disrupt hospitals if staffed physicians are no longer in-network. Unless legislation to curb surprise billing is implemented, patients could be on the hook for out-of-network charges, raising reputational and social risk for hospitals," Moody's said.
© Copyright ASC COMMUNICATIONS 2019.
Interested in LINKING to or REPRINTING this content? View our policies by clicking here.
No comments:
Post a Comment