UnitedHealthcare and Envision extend contract, avoiding coverage lapse for millions

Liquidated damage clause in management agreement
An agreement between UnitedHealthcare and Envision keeps the company’s physicians—including emergency doctors—in-network. (shironosov)

The nation’s largest health insurer and Envision Healthcare have signed an agreement to keep the staffing company in-network, ending a drawn-out dispute between the two companies.

The contract renewal with UnitedHealthcare, which was set to expire on Jan. 1, ensures Envision’s 25,000 clinicians across 45 states and the District of Columbia remain in-network.

“We are pleased to continue our long-term relationship with UnitedHealthcare by successfully extending our agreement to ensure patients have in-network access to Envision Healthcare hospital-based clinicians,” Envision Healthcare CEO Christopher A. Holden said in a statement. “We believe this is an opportunity for clinicians and payers to work together to make progress toward a more effective healthcare system.”

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“This agreement ensures the people we serve have continued access to Envision’s hospital-based services while delivering better value to our customers and consumers,” UnitedHealthcare said in a statement.

RELATED: Envision doubles down on marketing push to stay in UnitedHealthcare’s network

Both companies declined to provide specifics on the terms of the contract, including payment rates or the length of the agreement.

The two healthcare giants spent the last year in negotiations after UnitedHealthcare said it would cut ties with the hospital staffing firm, citing “highly questionable billing practices and a lack of candor.” Envision, which has previously been identified as a primary culprit of surprise billing, said it overhauled its strategy in 2017 with the goal of becoming in-network with as many insurers as possible. The company said 90% of its business comes from patients who are in-network.

Bob Kneeley, Envision’s senior vice president and head of government affairs, told FierceHealthcare recently that UnitedHealthcare accounts for about 1 million of the 35 million patients the company encounters each year.

RELATED: As UnitedHealth negotiations intensify, Envision targets surprise billing with new marketing blitz

The negotiations appeared to be hitting insurmountable hurdles heading into the beginning of 2019. Less than two weeks ago, Kneeley said he was “perplexed” by UnitedHealthcare’s decision remove them from its network. UnitedHealthcare sent letters to more than 950 hospitals, warning them that they could see decreased patient satisfaction and higher out-of-pocket costs as a result of Envision’s out-of-network status. Negotiations stalled in the fall because Envision requested a rate of 600% more than what Medicare allows, according to the insurer.

In response, Envision launched what one analyst called a “ballsy attempt at a marketing campaign” to shift the blame around surprise billing, and accused UnitedHealthcare of “prioritizing profits” over patient care. Envision was acquired by investment firm KKR for nearly $10 billion earlier this year.

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