A few weeks ago, in August, 2019, the giant insurer UnitedHealth informed the large physician services company, TeamHealth, which fields physicians in many specialties including anesthesiology, emergency medicine, and hospitalist services, among others, that it would be dumping TeamHealth from two-thirds of their high reimbursement in-network contracts over the next 11 months.
As of this writing, nothing’s reported to have changed. Maybe they’ll kiss and make up. But maybe not. It’s been reported that TeamHealth may be ramping up to file suit.
The UnitedHealth/TeamHealth scuffle intersects with topics addressed elsewhere on the blog and presents interesting opportunities for some physicians and their medical groups.
For example, being removed from UnitedHealth plans might put Team Health’s exclusive contracts with hospitals at risk. Recall, for example, my August 19, 2019, post, Hospital Sues Medical Group. Medical Group Returns The Favor. Both Likely Lose., which reported on the fact that Trinity Health, a not-for-profit Catholic healthcare system doing business in Michigan had filed suit against the large, exclusively contracted Anesthesia Associates of Ann Arbor, also known as “A4,” claiming that A4’s becoming out-of-network with several payers violated the terms of the exclusive contract. Trinity wants to bring in its own anesthesia providers and seeks to use A4’s anesthesiologists and CRNAs, who are subject to non-competes, to do so.
Will TeamHealth lose exclusive contracts due to being forced out of network? Will this pose an opportunity for other groups to attack Team Health’s position as the exclusive provider?
Additionally, moves such as this by UnitedHealth to terminate TeamHealth from its network are likely emboldened by the increase in the number of states that have adopted so-called “surprise medical bill” legislation.
That type of legislation usually forces so-called “average contracted rates” on out-of-network physicians subject to its “fix.” By throwing higher reimbursed groups out of the network, the average, and thus the amount to be paid to non-contracted providers, falls, perhaps precipitously.
Only time will tell what happens to UnitedHealth and to TeamHealth as a result of the kerfuffle.
Other groups in competition with TeamHealth should be ready to pounce.
The situation also demonstrates that although large groups with national contracts can use their market power to cut great deals, they can also be singularly disadvantaged when great numbers of those contracts are terminated – strength turned into fragility.
