After the two parties were unable to come to a new agreement before the end of 2024, Providence Health & Services in Oregon was removed from Aetna’s health insurance network.
The non-profit Catholic health system and insurance behemoth stated that Providence’s agreement with Aetna ended on December 31.
This implies that patients of Providence clinics, hospitals, and physicians who are covered by Medicare Advantage and Aetna’s employer-based plans would now have to pay high out-of-network fees, increasing their out-of-pocket expenses, or find another provider.
Approximately 9,000 patients in Oregon who have Aetna policies will be affected, according to Providence.
Providence is requesting irrational rate hikes that would increase out-of-pocket expenses for members and health plan costs for local employers, therefore we have been unable to renew our network agreement while our conversations continue, Aetna stated in a statement.
Providence, on the other hand, said that Aetna has not been willing to pay its fair portion of the growing expenses of health care, despite other insurers agreeing to do so.
According to Providence and Aetna, Providence clinic providers in Jackson and Josephine counties will remain in-network until February 17, despite the fact that the stalemate will affect consumers over a large portion of Oregon. For its medical clinics in southern Oregon, Providence has not yet finalized a new agreement with Aetna; these clinics have a different relationship with the insurance company than Providence facilities in other parts of the state. (Aetna’s network dropped several hospitals on January 1, including Jackson County’s Providence Medford Medical Center.)
The repercussions coincide with the health giant based in Renton, Washington, switching its staff to 2025 plans run by Aetna. Providence, however, stated that this change has no effect on employee benefits because Aetna’s participation is restricted to plan administration and the health system is self-insured. In a self-insured plan, the administrator manages networks and claims, while the employer pays for medical expenses rather than purchasing insurance.
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Due to a primary conflict: payment, contract disputes between health care providers and insurers have become more prevalent across the country. Though they are still sharply split on the exact amount, both sides concur that service remuneration ought to rise. Each side is battling to safeguard its financial interests in these high-stakes negotiations, which have become a recurrent battlefield.
Providence nearly ended its relationship with Regence BlueCross/BlueShieldover last year, but they were able to reach an agreement right before the deadline. Similar to this, Oregon Health & Science University and Aetna were at odds, but they were able to work out a new agreement in time to prevent any problems.
In order to offset the financial burden of caring for Medicare and Medicaid patients, whose reimbursement rates sometimes fall well short of real spending, hospitals argue that larger payments from insurers are necessary to cover growing operating costs.
Providence is now engaged in tense talks on new labor contracts with its nurses and other healthcare providers. On January 10, over 5,000 frontline staff members, including nurses and doctors, at Providence locations throughout Oregon informed the health system that they would be going on strike.
–Kristine de Leon uncovers tales about data enterprise, small company, retail, and consumer health. [email protected] is her email address.
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