UHC Vows To Appeal Ruling Against Cutting Doctors From Network

December 9, 2013

December 6, 2013

Article as it appeared in the Hartford Courant

Doctors associations and public officials on Friday celebrated a federal judge’s decision to block UnitedHealthcare from cutting thousands of doctors from its Medicare Advantage network in 2014.

The insurer, however, warned that the ruling — just two days before the Saturday enrollment deadline — would confuse patients, and it promised to appeal.

How it all plays out is likely to be watched closely by other states, including Ohio, New York, and Florida, where the insurer also has notified physicians they would be dropped.

“This is setting a precedent,” said Dr. Robin Oshman, president of the Fairfield County Medical Association. “They are watching to see what happens in Connecticut.”

In his decision to issue a temporary injunction, filed in U.S. District Court in Bridgeport on Thursday, Judge Stefan R. Underhill said the Fairfield County Medical Association and the Hartford County Medical Association showed that the removal of 2,250 doctors from the UnitedHealthcare Medicare Advantage network could cause irreparable harm.

The injunction prohibits the health insurer from dropping any of the associations’ doctors from the network, from notifying patients of any of those terminations for 2014, and from removing those doctors — 810 primary care physicians and 1,440 specialists — from its directories for next year.

Mark Thompson, executive director of the Fairfield County Medical Association, said the injunction will keep those 2,250 doctors in the network for 2014. “This will lock those patients in with their doctors for another year,” he said.

A UnitedHealthcare spokeswoman on Friday said she could not speculate on whether the doctors would be in the network for the entire year.

UnitedHealthcare is the largest private Medicare insurer in Connecticut.

Soon after the ruling was made public Thursday, company spokesman Terence O’Hara said in an email: “We respectfully disagree with the court’s preliminary ruling and intend to appeal immediately. We believe the court’s ruling will create unnecessary and harmful confusion and disruption to Medicare beneficiaries in Connecticut.”

Connecticut Attorney General George Jepsen on Friday hailed the ruling.

“This decision confirms my view that these terminations — unprecedented in scope — offend public policy and threaten irreparable harm to patients whose relationships with their doctors are at risk of disruption,” Jepsen said in a written release.

“United’s lack of transparency for both physicians and patients has been of great concern,” Jepsen said. “I urge United to abide by the court’s decision and its clear contractual obligations to all affected physicians, not just those who are members of the Fairfield and Hartford County Medical Associations. Its failure to do so will only compound the confusion United has already caused to thousands of vulnerable Connecticut patients and prospective Medicare Advantage enrollees, who deserve much greater care and respect.”

Last month, the state’s congressional delegation wrote to the Center for Medicare & Medicaid Services, which determines whether an insurer’s network is adequate for patients, with their concerns about the situation with UnitedHealthcare. The center, which could restore the doctors to the network, has not responded to the letter.

“Senior and elderly patients have relied on these doctors,” U.S. Sen. Richard Blumenthal said in an interview Friday, calling the insurer’s decision “shortsighted and misguided.”
The state’s congressional delegation said in a joint statement on the temporary injunction: “[Thursday’s] court decision is a victory, giving patients some assurance, if only temporary, that they will continue to receive vital care from the doctors they know and trust.”

Larger Context

The legal battle between UnitedHealthcare and the Connecticut medical associations flared in U.S. District Court on Tuesday, when their lawyers debated whether, by contract, the insurer has the right to eliminate thousands of doctors on Feb. 1.

But the drama is playing out against the larger backdrop of health care reform. A trade group for health insurers, America’s Health Insurance Plans, has warned that the Affordable Care Act cuts payments to insurers who take part in Medicare Advantage.

In 2010, the nonpartisan health policy group Kaiser Family Foundation sorted through the effects of cutting Medicare Advantage and wrote in an analysis, “[S]ome companies may decide to raise beneficiaries’ premiums and/or cost-sharing requirements, reduce their network of providers, reduce extra benefits, or make improvements to obtain quality-based payments.”
Matthew Borsch, a financial analyst for Goldman Sachs who covers UnitedHealth Group — the parent company of UnitedHealthcare — attended a recent investor conference held by the insurer.

UnitedHealth Group highlighted “an enormous” $1.6 billion after-tax earnings impact from health reform and other head winds in 2014, mostly in the Medicare Advantage business,” Borsch wrote in a Dec. 4 note to investors.

State Sen. Kevin Kelly, R-Stratford, said in a statement Thursday, before the ruling: “Obviously the decision to cut doctors from the Medicare Advantage program was an attempt to save funds in the wake of the Affordable Care Act losses. However, shifting the problems caused by the new law onto those most in need is unacceptable.”

The federal government, through its Centers for Medicare & Medicaid Services, has instituted a five-star quality rating system that provides incentives to insurers to reduce costs. Thompson, of the Fairfield County Medical Association, cited it as a contributing factor in the UnitedHealthcare change.

O’Hara, a UnitedHealthcare spokesman, rejected the notion that UnitedHealthcare was dropping doctors who are most expensive, or those doctors who are seeing the sickest patients. The five-star program is about improving quality, he said.

“When you apply clinically based and evidence-based standards for primary and preventive care, when you apply those same standards to the management of chronic diseases, higher quality results, and less health care spending,” O’Hara said. “That is the link between cost and quality.”