UnitedHealthcare terminates Mednax from its network over pricing squabble

Samantha Liss Feb. 21, 2020

Dive Brief:

·         UnitedHealth Group is cutting ties with Mednax, a physician staffing firm that focuses on providing specialty services including anesthesia, neonatology, and high-risk obstetrics in both urban and rural areas, Mednax reported Thursday.

·         This means Mednax’s services will no longer be considered in-network for UnitedHealthcare members. Mednax said the "surprise terminations" will apply to all of its services throughout four states, Arkansas, Georgia, North Carolina and South Carolina, effective between March 1 and Sept. 1. 

·         Mednax’s CEO Roger Medel said he was disappointed with United’s decision to terminate the company’s physicians from its networks. But UnitedHealthcare said it’s looking for "fair market prices" from Mednax, which has charges more than 60% higher than other firms that provide similar services in these states, according to a statement from the insurer.  

Dive Insight:

This contract issue comes as Congress is still mulling various bills to curb surprise billing. Congress failed to pass any legislation last year to fix the issue and it’s unclear whether a bill will pass during a potentially contentious election year. 

Surprise billing is a vexing problem, particularly for consumers who do their due diligence in going to an in-network facility but are still exposed to an out-of-network doctor, sticking them with a potentially exorbitant medical bill. 

Unless a solution is reached before March 1, this contract dispute will likely expose patients to surprise medical bills they were not expecting, particularly for expecting mothers with high-risk pregnancies and newborns who are ill and require neonatology services. It could also pull in patients undergoing surgery as Mednax’s anesthesia services in those four southern states will be considered out-of-network. 

UnitedHealthcare, part of UnitedHealth Group, is the nation’s largest insurer, covering 27.7 million people with commercial insurance, 9.7 million Medicare enrollees and 5.9 million Medicaid members. 

However, depending on the insurance product, some may be protected from potential out-of-network bills, according to Sabrina Corlette, an expert on healthcare policy and a research professor at Georgetown University.

"Remember that for fully insured products, UHC is required to maintain network adequacy, and that includes in-network access to these specialties. Some states are good about holding carriers' feet to the fire on that, some, not so much," she tweeted on Thursday about the dispute.

Mednax, based in Florida, has a network of more than 4,325 physicians in all 50 states and Puerto Rico.

The dispute could pose a hit to the company’s finances, though the company did not provide any estimates of potential impact. Mednax "is not able to forecast the outcome of this matter," the company said in its earnings release. ​

However, the company did disclose that total annual revenue from United accounted for 2%, or $70 million, of Mednax’s 2019 consolidated revenue of $3.5 billion revenue.

https://www.healthcaredive.com/news/unitedhealthcare-terminates-mednax-from-its-network-over-pricing-squabble/572734/