Humana letters leave CEO blindsided
CHARLESTON, W.Va. - Call it the power of word processing: two letters set off a chain of events last month that still has thousands of state Medicare recipients shaken up, hospital administrators scratching their heads and West Virginia lawmakers fighting mad.
On Dec. 5, Thomas Health System president and CEO Steve Dexter received a letter from the Medicare Advantage provider Humana.
The one-page letter said Humana would terminate its contract with St. Francis Hospital effective Feb. 1, 2012.
"The dynamics in the Charleston area have changed and the ChoiceCare Network is reconfiguring its network," read the opening sentence.
One day later, an identical letter arrived at Thomas Memorial Hospital in South Charleston. The letters, signed by director of contracting Beverly Steen, quoted part of Humana's agreement with the hospitals:
"Either party may terminate this agreement without cause at any time . . . by providing to the other party 90 days prior written notice of termination."
Dexter said the correspondence came "totally out of the blue." It was such a surprise that the CEO didn't think the letters were genuine.
He called Humana, and representatives told him not to worry. They said the company was canceling all of its contracts and drafting new ones.
Dexter received that new contract a week later and found it did not include any personal coverage for Humana Medicare patients.
Again, the CEO was blindsided.
Between 2009 and 2011, about 3,600 of the hospitals' patients received health coverage through Humana.
Thomas Health Systems' contract with the company was set to expire Jan 31, 2012. Hospital officials figured if Humana were to terminate its contract, they would have received word in late October or early November.
"We wrote back and said, 'Do the math,' " Dexter said. "You gave us 56 days notice."
Humana customers received a letter from the company around Christmas Eve announcing St. Francis and Thomas would no longer be in Humana's coverage network.
The letter included a list of in-network hospitals, like Charleston Area Medical Center's four hospitals, Boone Memorial in Madison and Montgomery General in Fayette County.
"This change doesn't affect your benefits," the letter continued. "Your Humana plan benefits remain the same. When you need to go to a hospital, your primary care physician can help you choose the hospital that is right for you."
That apparently did not do much to comfort Humana customers.
Medicare Advantage plans are sponsored by the federal government but sold and administered by a handful of private companies.
Eligible persons can enter Medicare at any time, but there's a limited window to enter a Medicare Advantage plan. That "open enrollment period" stretched from Oct. 15 to Dec. 7 this year.
After Dec. 7, patients could not switch from one Medicare Advantage plan to another until the next year's open enrollment period. With the contract terminated, Thomas and St. Francis patients in a Humana plan would have to seek treatment elsewhere, at least until October.
Patients can switch back to a regular Medicare plan at any time, but Dexter said that's not an option for many people. Regular Medicare premiums and co-payments are higher, and regular Medicare doesn't offer dental or eye-care coverage as some Medicare Advantage plans.
St. Francis and Thomas soon were swamped with calls. Dexter said the hospital system received so many calls from concerned patients that it had to pull its public relations director and two secretaries away from their regular duties to man the phone lines.
Patients also started calling West Virginia's congressional delegation, as well as the attorney general, state insurance commissioner and governor's offices.
The state's political leaders quickly responded.
U.S. Rep. Shelley Moore Capito, R-W.Va., called Dexter on his cell phone to ask what she could do to help. Sen. Jay Rockefeller, D-W.Va., sent a letter to Humana on Jan. 4, about a week after patients received their letters from Humana.
"I am outraged," Rockefeller wrote.
"My office has received hundreds of calls from panicked seniors who are afraid they will lose access not only to their preferred hospital, but also to the affiliated physicians they know and trust. I have even received reports that some of these patients have cancelled surgeries in reaction to the news."
Rockefeller condemned the Medicare provider for their poor customer service.
"One woman who was calling on behalf of her disabled daughter had to keep asking for a supervisor. She was then transferred from department to department because the person she was referred to did not know what she was talking about," he wrote.
Just one day after Rockefeller sent his letter, Humana announced it would continue to cover services at Thomas and St. Francis at in-network rates.
On Jan. 5, Humana spokesman Jeff Blunt emailed Paige Johnson, spokeswoman for Thomas and St. Francis, saying the company was "in the process" of notifying all impacted Humana Medicare members that they would be able to receive services at the hospitals throughout 2012 at in-network benefit levels.
"This means Humana Medicare members will pay no more for services at these hospitals throughout the rest of this year than they currently pay," Blunt wrote.
Dexter said he's not sure Humana has notified any patients of its new decision, as he can't track down a copy of the letter the Medicare provider promised to send. He recently met with the hospitals' surgeons, who told him patients are still upset because they haven't received any official correspondence from Humana.
The hospital system also does not have any contract with Humana saying patients will be covered after Feb. 1 but is proceeding as if they're covered.
Dexter expected correspondence from Humana last week but as of Friday evening had not received anything from the company.
Rockefeller's letter also requested that Humana explain its decision to drop Thomas and St. Francis. Dexter said he has made similar requests. So far the company has not responded.
"They've given us nothing to tell us why," Dexter said.
Dexter would not speculate on why Humana dropped the hospital. However, he is sure the decision had nothing to do with the hospitals' quality of care.
He pointed out the company said its contract termination was "without cause." If Humana had concerns about the quality of care at Thomas or St. Francis, it would have had to notify the hospitals of those problems before canceling the contract.
Humana representatives declined the Daily Mail's requests for an interview.
Blunt, writing in an email last week, said he could not discuss the history of Humana's discussions with St. Francis and Thomas Memorial and "can't share the rationale" behind the company's decision to terminate its contract with the hospitals.
"However, I can confirm that we are in talks with both hospitals and hope to reach an agreement that would keep them in our network beyond 2012," Blunt wrote in an email.
'A huge disruption'
Dexter confirmed he has been in negotiations with Humana but has mainly focused on securing a contract for 2012. Once that's established, he said he would work on a 2013 contract.
"We don't want to be sitting here 11 months from now and you've got the same issue," he said.
If negotiations fall through and Humana stops covering patients at Thomas and St. Francis in 2013, doctors either would have to give up patients or send patients to specialists they don't know. They also couldn't visit patients in the hospital, leaving them in the hands of hospital doctors unfamiliar with their medical histories.
"It's really a huge disruption through the whole system," Dexter said.
He said he doesn't know exactly how much money Thomas and St. Francis stand to lose if Humana patients are funneled to other are hospitals.
"It wouldn't be good," he said.
Last week, Sen. Joe Manchin, D-W.Va., also sent Humana a letter urging the company to work with the hospitals to secure a contract that would cover patients through 2013.
"Humana could still discontinue its Medicare Advantage relationship with these hospitals during the next Open Enrollment period, which is just 10 months from now.
"I am hopeful that Humana will continue to keep in mind the needs of West Virginians before making a final decision," Manchin wrote.