Durham, N.C.-based Duke University Health System and UnitedHealthcare have been in contract negotiations over the last few weeks regarding around 172,000 Duke Health patients and their care access.
Should the parties be unable to come to an agreement, Duke Health's hospitals, facilities and physicians will be out of network, effective Nov. 1, for the employer-sponsored commercial plans, including UMR, and Medicare Advantage plans, which include a group retiree and dual special-needs plan.
The Duke Health integrated practice physicians, previously known as the private diagnostic clinic, would not be affected by the party negotiation and will remain in the UnitedHealthcare network, a spokesperson for UnitedHealthcare said in an Oct. 8 statement shared with Becker's.
UnitedHealthcare said that while Duke Health is one of the most expensive health systems in the southeast and has a much higher cost than other peer academic health systems in North Carolina and surrounding states, the health system continues to require price increases that consumers cannot afford.
"It remains our top priority to renew our relationship and ensure continued access to Duke Health," the UnitedHealthcare statement said. "We delivered a new proposal on Oct. 1 that includes meaningful rate increases. We continue to await a counter. We urge the health system to provide a proposal North Carolina families and employers can afford. We believe quality care can also be affordable and the people of North Carolina deserve both."
Becker's also connected with Craig Albanese, MD, CEO of Duke University Health System, to discuss the challenges faced through contract negotiations with UnitedHealthcare and the health system's plans moving forward.
Editor's note: Responses have been lightly edited for clarity and length.
Question: What are the most pressing difficulties you've faced during negotiations with UnitedHealthcare, and what strategies are in place to minimize disruption for the 172,000 patients affected?
Dr. Craig Albanese: Leaders providing healthcare services want to help those in need and keep our communities healthy. Patients, using their voice, want three things from their health care providers: "Heal me, don’t hurt me and be kind to me." Of course, access to their trusted providers is also paramount. While we do as the patient requests, and more, UnitedHealthcare continues to add burden. All the headaches to get paid when we provide quality-oriented, patient-first, 24-hour care should not be part of the insurance process.
We continue to have significant concerns regarding our contract with UnitedHealthcare. Both parties agreed that the primacy of patient care and the value of said care are paramount. However, UnitedHealthcare has created significant barriers that affect patient access to Duke Health, and additional barriers that keep Duke Health from receiving fair payment — which ultimately impacts our patients and our mission. Across the nation, many health systems have had to terminate contracts with UHC due to the administrative burden, which people are now calling "administrative harm."
UHC's system appears to be designed to delay and deny fair payment. At Duke, UHC denies payment for care 40% more than other national insurance carriers we contract with. Duke Health overturns 97% of these denials after significant effort (people, time and technology). Imagine a world where those resources were deployed to help patients and provide for healthier communities?
At Duke, we employ 236 people full time to appeal all denials from payors, which is frankly outrageous and is not in the spirit of both parties partnering to provide value to beneficiaries, patients, communities. Finally, UHC has been 57% slower to pay claims than our other payers and takes over 60 days to respond to claims they deny. Thus, Duke Health spends substantial time and money to collect payment that should have been made, and made promptly.
Our chief concern is our patients, and we have been working diligently to ensure that their care needs are fulfilled. We continue to help educate patients about their Continuity of Care rights and encourage those who may qualify for continuity care to apply through UnitedHealthcare. Of course, Duke Health will continue to provide emergency services to United Healthcare patients. We've also been proactively communicating with patients since August to help ensure everyone has the information and lead time they might need to plan, particularly during open enrollment, so they are not left without options and can make the best forward-facing decisions for their and their family's health care needs.
Q: How are you balancing patient care access with the need to secure beneficial contract terms?
CA: Duke's publicly reported data support the high level of quality, safe and patient-centered care to support the health care needs for all who come to us for hope, health and healing. As a not-for-profit academic leader in health care delivery, it is deplorable that we have to fight such a high level of administrative burden.Regardless, we have been and are always here for our patients.
As Duke continues to recover from the effects of the pandemic and inflation, we are steadfast in our efforts to expand patient access in a myriad of cost-efficient ways, such as opening additional outpatient clinics, expanding online scheduling, providing in-home care and enhancing our telehealth programs to ensure our patients have access to the best value health care. In addition, and right now, we have proudly joined others to assist in the relief efforts for the hurricane ravaged communities of western North Carolina.
Q: What strategies is Duke Health implementing to protect its financial health during the negotiation process?
CA: We are having clear and transparent conversations with all of our stakeholders. It is a compelling story when we focus on the data and our patient needs. People want to come to Duke and to be treated by Duke physicians. We participate with as many insurance plans as possible to enable this access.
However, when UHC expects Duke Health to be paid less than costs, that is not a viable model. After years of increases that were significantly less than labor and other costs, Duke is making the choice to protect its future. We must protect the communities we serve by being fair but firm with this payer, especially since Duke is the safety net health system for its community. Here’s the good news: the amount of local support has been amazing and humbling. People want to be able to access Duke Health and have their UHC insurance cover it.
Q: When do you expect negotiations to wrap up? Do you have contingency plans in place should negotiations be prolonged, or an agreement cannot be reached by Nov. 1?
CA: We had every hope that we would have been done by now and we communicated a deadline with multiple weeks’ notice to UHC. We are not there. We were willing to make reasonable changes in our last offer as a means to expedite negotiations for our patients. UHC responded with zero movement. Therefore, we are actively working with brokers, employers, and patients on next steps, either through continuing care with Duke or when needed supporting a transition to other providers. We want this to be resolved but cannot risk our financial well-being based on UHC’s offer — it is a paradox, but we owe this to our patients to stand firm and to fight for them, even if standing firm causes us to be out of network with UHC for the short or long term. UHC can make this go away but they have chosen not to.
Q: What advice do you have for other health system leaders who are going or might go through this same experience?
CA: Lead with the patient in mind, validate and communicate with UHC why these practices of deny and delay are so detrimental to the healthcare system and move forward to a viable solution. Inform your patients, employers and brokers so they can make informed decisions about their insurance company.
Duke Health is far from the first and definitely not the only health system to experience this situation with UHC. We would encourage other health systems to be as prepared as possible for the fallout that these negotiations cause. We have been and are focused on communication with our patients, providers and staff at each phase of the negotiation. We are now explaining to our community of patients and providers the next steps in a very complicated process — continuity of care. This education is the responsibility of UHC. Yet, UHC's staff has recently called the Duke Health team for advice and education on how to handle this very difficult situation.
Q: What data can health systems best arm themselves with when sitting down with commercial payers for contract negotiations?
CA: There is no secret here. Be meticulous about your data — volume, service mix, quality, safety, patient experience. Bring forth the delay, deny and underpay data and the burden that it has on your organization. These are negotiations — they are never perfect, never joyful. There is always give and take — each organization will determine for themselves the lines that should not be crossed.
Q: How will the relationship between health systems and large insurers like UnitedHealthcare evolve over the next two to three years, particularly as more health systems take a firmer stance in contract negotiations?
CA: We want to have a relationship, yet our definitions seem different. Our mission at Duke Health is to provide the highest value care to our patients. UHC's response is that it is "protecting" health care costs when in reality, if they actually paid what was owed without Duke Health fighting denials, we might have a better relationship — a partnership, if you will.
More and more health systems are going public with these problems because these administrative burdens are increasing and they disrupt care to patients who are simply wanting to access their providers whom they know and trust.