With ARH filing lawsuits in Franklin Circuit and federal court in Lexington, Harlan ARH Hospital CEO Dan Stone said Coventry Health and Life Insurance Company has cancelled their contract with ARH effective May 4. He said Coventry Health and Life Insurance has represented approximately 80 percent of the medicaid patients Harlan ARH Hospital serves.
On March 29, Coventry gave ARH notice it was terminating its contract with ARH effective May 4 and refused to renegotiate the terms of their agreement.
In both lawsuits filed by ARH, they claim they have provided health care to numerous low-income patients covered by Medicaid, but have not been properly reimbursed by either Kentucky Spirit Health Plan Inc. or Coventry Health and Life Insurance, which are Medicaid managed care organizations under contract with the Kentucky Cabinet for Health and Family Services.
In a letter to ARH President and CEO Jerry W. Haynes from Coventry’s Executive Vice President, Government Program, Timothy Nolan he said “the current crisis would have never occurred except for the Commonwealth’s failure to make timely and reasonable decisions on three major issues.” Those issues are failure to implement a risk adjustment methodology, failure to find a solution to the supplemental hospital payment issue and errors in the original data book and failure to ensure all MCOs meet the same robust standards for network adequacy.
“The impact to those patients (with Coventry Insurance) not being able to get health care locally will be tremendous, not only from the standpoint of continuity of care and seeing the doctor you’ve always seen to the hardship of gas costs and finding transportation to and from,” said Stone. “From a patient’s perspective, it’s going to have a major impact on the health care of those recipients.”
Stone said from an ARH employee’s perspective, “you can’t lose somewhere between 15 to 25 percent of your business and not have an economic impact on your employees here locally.”
Community and Patient Advocate Mark Bell said Medicaid is about 36 percent of ARH’s patient market in Harlan with Coventry covering 75 percent of those lives. He said over the past six months, nearly 11,000 Medicaid patient visits have been recorded at Harlan, with 7,800 of them being covered by Coventry. Bell said with the loss of these patients from the Harlan County community, and the entire region ARH serves, this will “present a complex and serious crisis for everyone.”
“We’re very concerned about that,” said Stone. “We want this to be resolved and we want people to have access to health care locally. We want to continue that continuity of care that is so important in the care of the patient.”
In a press release Haynes said with 50 to 60 percent of their costs being personnel, with a loss in patient volumes and associated revenues, there will have to be “significant reductions in staff and hours worked.”
“It’s obvious that ARH is caught in the middle of a dispute between the state and Coventry, which if unresolved will cause many of our people to be hurt,” said Haynes.
Stone said he hopes all this will be resolved before May 4 and Harlan ARH Hospital will be able to continue to provide services as they always have.
Reach Nola Sizemore at 606-573-4510 or at email@example.com