Feb 8, 2023
Source: Richmond Photo / Image Source: Unsplash,
Health system Bon Secours and insurer Optima Health have up to now failed to negotiate a contract that would keep Optima customers in network at Bon Secours facilities.
Optima says the health system is unreasonably increasing prices. Bon Secours says that a higher cost of treating patients necessitates higher rates.
At stake is the cost of health care for 55,000 Optima customers living in Virginia. A large percentage of them are Medicaid recipients. If an agreement isn’t reached by March 1, Optima customers will be considered out of network at Bon Secours facilities, raising the price of their hospital bills. Inflation has driven up the cost of providing care, said Jenna Green, a Bon Secours spokesperson. The health system cannot continue to absorb those costs without payors such as Optima keeping pace. Bon Secours St. Mary’s HospitalBon Secours St. Mary’s Hospital “Bon Secours is attempting to bring Optima up to parity by the end of the proposed term for this health plan to require them to pay their fair share of the health care costs within our communities,” Green said.
Optima is owned by a competing nonprofit health system, Sentara Healthcare. Sentara and Bon Secours both operate hospitals in the Hampton Roads region.
“Being part of Sentara, we have a full understanding of the challenges health care systems are facing with inflation and rising costs,” said John Syer, a vice president for Sentara. He called Bon Secours’ proposed rate increases “unprecedented in the industry.”
Of the 55,000 Optima customers in Virginia, about half live in greater Richmond, and half live in Hampton Roads, said Michael Kafka, a spokesperson for Sentara.
About two-thirds of those patients are Medicaid recipients. If Bon Secours and Optima don’t come to an agreement, the Medicaid patients would have to seek treatment at other facilities, said Doug Gray, executive director of the Virginia Association of Health Plans. Hospital options are relatively abundant in the Richmond area, one of the state’s most competitive for health systems, Gray said.
Generally, when a patient is treated by an out-of-network medical group, the patient pays a higher percentage out of pocket.
In some cases, the federal No Surprises Act protects patients from being billed out-of-network if they’re treated by a provider at an in-network facility. “However, that is not applicable across the board,” Green said. “Patients are encouraged to speak with Optima to fully understand what their health insurance plan will cover.”
The contract with Optima has been in place since 2004 and was last amended two years ago. Both sides said they will continue to negotiate.
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