Minnesota seniors feel like pawns in HealthPartners, UnitedHealthcare dispute

The ongoing contract dispute between HealthPartners and UnitedHealthcare is frustrating Medicare beneficiaries across the Twin Cities, as seniors try sorting through mixed messages on everything from the frequency of coverage denials to how the rupture will impact their health care.

Adding to the confusion, the dispute raises different issues for seniors depending on whether they buy coverage on their own or have benefits through a group plan sponsored by a former employer.

Bloomington-based HealthPartners disclosed last month that seniors enrolled in UnitedHealthcare Medicare Advantage health plans won't have in-network access to the health system's hospitals and clinics starting Jan. 1.

This means some 30,000 patients next year might not be able to keep seeing their doctors, HealthPartners says, unless they jump to a new health plan.

But in public statements, Minnetonka-based UnitedHealthcare has cast doubts about this for a subset of seniors — retirees with benefits through their former employers — saying they will still have coverage next year at HealthPartners with little or no change in cost-sharing. HealthPartners counters that this is wrong: the insurer's Medicare Advantage enrollees won't be able to schedule appointments or use out-of-network benefits at the health system.

"What we're wondering is: Is there a true negotiation happening — are they really bargaining in good faith, both parties?" said Denise Rodriguez, a retiree from St. Paul Public Schools who also is a past president of the teachers union. "Or is HealthPartners really, truly done with UnitedHealthcare because of all the delays and denials?"

In truth, different scenarios could be true next year depending on future negotiations, although it's not clear if the two sides will resume talks.

"This is a tough situation for the seniors involved," said Jack Hoadley, a health policy researcher at Georgetown University. "People should keep watching, since things could change between now and open enrollment in the fall."

"Sometimes these disputes become public because the players are trying to generate public pressure to get their preferred outcome in a negotiation," said Jeannie Fuglesten Biniek, a researcher who focuses on Medicare issues at KFF, a California-based health policy group.

HealthPartners says excessive payment delays and coverage denials by UnitedHealthcare are one of the main reasons the health system is dropping out of the insurer's Medicare Advantage network. UnitedHealthcare calls these allegations outlandish and untrue.

There have been fewer problems, HealthPartners says, with denials in UnitedHealthcare coverage for non-retirees with employer-sponsored plans.

"We are still negotiating terms for UHC commercial patients," the health system said in a statement.

Some seniors say they've experienced delays and denials. Others express general allegiance with HealthPartners: They've known the nonprofit health system for decades, whereas UnitedHealthcare is a for-profit company that's relatively new to Minnesota's Medicare market.

The bottom line for most is uncertainty.

Mary Boyd, a former St. Paul schools administrator, said she trusts her doctors at HealthPartners, whereas she regards UnitedHealthcare as a business. But Boyd has heard the insurer's argument, that HealthPartners is simply using the dispute to push for above-market reimbursements, and isn't sure what to think.

"It feels like seniors are just pawns in this," she said.

Jim McDonough, a former Ramsey County commissioner who is covered by the county's health plan for retirees, said he was concerned when county officials made the decision to switch benefits to UnitedHealthcare starting this year. The insurer, he said, came in with a lower-cost bid.

"Do they keep costs down by denying coverage?" McDonough asked. "I don't know — is that what's playing out here?"

HealthPartners is one of Minnesota's largest operators of hospitals and clinics, including Regions Hospital in St. Paul and Methodist Hospital in St. Louis Park. UnitedHealthcare is the nation's largest health insurer, which introduced in 2019 its Medicare Advantage plans in Minnesota.

These health plans are an increasingly popular form of coverage where people opt to receive government-sponsored benefits through a private managed-care company. HealthPartners, which also is a large regional health insurer, competes with UnitedHealthcare for Medicare Advantage business.

Depending on how people obtain insurance, the HealthPartners-UnitedHealthcare contract dispute has different impacts.

People who buy Medicare Advantage coverage for themselves have the chance to make changes every fall during open enrollment. For these consumers who want to stick with their HealthPartners doctors, the guidance is relatively clear: Once open enrollment begins in October, they can look for a plan where HealthPartners is an in-network provider.

It's a more complicated situation, however, for retirees enrolled in UnitedHealthcare Medicare Advantage through their former employers. This coverage is sometimes subsidized, but only when seniors use the health plan selected by the employer — so shopping around might not be the best choice.

In addition, retirees who leave a group plan to buy on the individual market might not be allowed back into the employer-sponsored plan at a later date. Retirees need to check with their former employers for details.

UnitedHealthcare argues that seniors in group retiree Medicare Advantage plans should speak with their HealthPartners doctors to confirm whether they'll stop seeing them next year. The insurer said if HealthPartners ultimately leaves the insurer's network, it wants the health system to keep seeing group retiree members on the same financial terms as out-of-network health care providers across the country do.

"Why would HealthPartners turn these members away given the health system would be reimbursed the same as Original Medicare and in most cases the member's cost share would be the same?" UnitedHealthcare said in a statement to the Star Tribune. "We believe it's another tactic by HealthPartners to use its patients and our members as leverage by threatening to unnecessarily disrupt their access to care."

HealthPartners argued that these statements from UnitedHealthcare are wrongly creating confusion when the health system has been clear — the insurer's Medicare patients won't be able to use out-of-network benefits next year at HealthPartners clinics and hospitals. The health system also says UnitedHealthcare has mischaracterized the health system's position on claims denials by calling it a negotiating posture.

UnitedHealthcare, HealthPartners said, denied payment on inpatient Medicare Advantage claims at a rate that is up to 10 times higher than other insurers. The health system added that a recent review of inpatient admissions between May and July found a 19% denial rate at UnitedHealthcare compared with 0.9% at the next-highest nonprofit insurer.

Some of these claims will ultimately be paid, HealthPartners said, but "only after months of administrative hassle for our doctors and care teams who do not have time to spare for that sort of needless burden."

"The fact is we have been working on the denial issue with [UnitedHealthcare] for more than two years...," HealthPartners said. "After all of that time and countless meetings, we cannot rely on [UnitedHealthcare] to meaningfully change their practices."

On denials, UnitedHealthcare says it's worked on "numerous initiatives" to improve the health system's "operational efficiencies and workflows." While some seniors have reported to the Star Tribune frustration with UnitedHealthcare requirements for prior authorization when getting services, the insurer said this step isn't required in the vast majority of cases.

"More than 99% of HealthPartners' claims that required prior authorization from Aug. 1, 2023, through July 31, 2024, were approved," UnitedHealthcare said. "The fewer than 1% of prior authorization submissions that were not approved were due to reasons such as a lack of required clinical information."

If UnitedHealthcare doesn't reach an agreement with HealthPartners, the insurer says it will follow federal guidelines for sending letters about the change that seniors receive "no later than 45 days prior to the expiration of our contract."

The possible split ensnares more than 4,400 retirees across St. Paul Public Schools, Ramsey County and the city of St. Paul.

The disruption on the horizon is "unacceptable," said St. Paul Mayor Melvin Carter, who said in a statement the city expects the parties "to go back to the table to keep their promises to our retirees."