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The Texas Organization of Rural and Community Hospital\u2019s Clinically Integrated Network, or TORCH CIN, said the termination represents \u201cone of the most significant statements of rural provider frustration in recent Texas healthcare history.\u201d The organization said UnitedHealthcare\u2019s reimbursement rates are unsustainable and threaten the financial survival of rural health systems. (Kailey Broussard | KERA)<\/p>\n
A physician-hospital organization representing 45 rural and community hospitals across Texas said it will end its contracts with UnitedHealthcare Insurance Company, starting at the end of the year.<\/p>\n
The Texas Organization of Rural and Community Hospital\u2019s Clinically Integrated Network, or TORCH CIN, said the termination represents \u201cone of the most significant statements of rural provider frustration in recent Texas healthcare history.\u201d The organization said UnitedHealthcare\u2019s reimbursement rates are unsustainable and threaten the financial survival of rural health systems.<\/p>\n
Paul Aslin, executive director of TORCH CIN, said his organization has been negotiating with UnitedHealthcare \u201cin good faith\u201d for more than 550 days \u2013 but despite biweekly meetings, TORCH CIN has not received a formal response to a proposal shared in January.<\/p>\n
\u201cWe would like them to acknowledge that they do underpay us compared to people that have more leverage, especially, for example, the urban hospitals,\u201d he said. \u201cWe would like for them to give us a proposal that is sustainable for our hospitals.\u201d<\/p>\n
In an email to KERA, UnitedHealthcare said it needs to balance the need to ensure long-term sustainability of TORCH providers with the need for affordable care.<\/p>\n
A UnitedHealthcare spokesperson referred to TORCH CIN\u2019s actions as a negotiating tactic and said they do not reflect the ongoing discussions the insurance company has had with TORCH CIN.<\/p>\n
\u201cWhile we are disappointed in [TORCH CIN]\u2019s recent actions, we remain committed to using the time left on our contract to reach an agreement that maintains long-term access to quality, affordable care for the families we serve throughout rural Texas communities,\u201d the spokesperson wrote.<\/p>\n
The spokesperson pointed to recent prior authorization reforms<\/a> as part of its effort to support rural hospitals and providers across the country. In addition, they noted that UnitedHealthcare supported the development of TORCH CIN through a multi-million dollar investment.<\/p>\n The statement also said the company has been actively engaged in negotiations and the two groups continue to exchange proposals.<\/p>\n Aslin said the decision to terminate its contracts was difficult because UnitedHealthcare helped start TORCH CIN and was a good partner for a while \u2013 but that fell apart with negotiations.<\/p>\n \u201cThe hope was that they would treat us fairly and work with us but just dragging their feet and not getting it done in a timely way, in a fair way, we had no other choice,\u201d he said. \u201cThe rates that we\u2019re asking for are not unreasonable. We\u2019re not asking for higher than or even relatively close to what they are currently paying other hospitals for the same services.\u201d<\/p>\n TORCH CIN referred to data from Texas A&M Health Rural & Community Health Institute and Turquoise Health that showed rural hospitals are paid up to 53% less than hospitals in metropolitan areas for emergency departments visits under commercial contracts and up to 44% less for labor and delivery services.<\/p>\n Aslin said rural hospitals are at a higher risk of closure \u2013 mostly because of low or \u201cunfair\u201d reimbursement rates.<\/p>\n \u201cWe\u2019ve been getting the same underpayments, in some cases, 10 plus years, while hospitals have to increase their costs because we have labor and clinicians that we pay,\u201d he said.<\/p>\n More than half of Texas\u2019 154 rural inpatient hospitals<\/a> are at risk of closing, according to the Center for Healthcare Quality and Payment Reform. The same report shows almost 70% of those hospitals have lost some of the services they are able to provide.<\/p>\n TORCH CIN facilities serve over 300,000 Texans across 45 hospitals, according to Aslin. Terminating the contract could put access to care at risk.<\/p>\n \u201cIt\u2019s not a good situation for the people that we serve,\u201d Aslin said. \u201cOur hope is that we can solve this with United, but if not, then those folks are going to be looking for a different alternative to who they use for their insurance.\u201d<\/p>\n TORCH CIN said there is still time before the contracts would end. Network agreements for private or employer-sponsored health plans would be terminated June 2027 and agreements for Medicaid-based health plans would be terminated at the end of this year.<\/p>\n \u201cIf they\u2019re willing to, in good faith, come back to the table…we\u2019re willing to negotiate,\u201d Aslin said. \u201cHowever, under the current circumstances we can\u2019t continue because we really are trying to look out for our rural hospitals.\u201d<\/p>\n Aslin also said insurance companies have a significant responsibility when it comes to rural communities having access to care.<\/p>\n \u201cIf they don\u2019t pay our hospitals a sustainable rate, our hospitals will close and those patients will be without access to local health care and that\u2019s not what we want,\u201d he said. \u201cWe couldn\u2019t stay under our current agreements and have all of our hospitals be sustainable, so the only alternative is to get paid a fair rate so that we can keep our doors open.\u201d<\/p>\n Abigail Ruhman is KERA\u2019s health reporter. Got a tip? Email Abigail at aruhman@kera.org<\/a>.<\/p>\n