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Lifting Antitrust Contract Clause Helps Connecticut Hospitals Serve Uninsured

By MATTHEW STURDEVANT

March 04, 2010

Three more hospitals signed contracts with a state health insurance program after Connecticut's largest insurer changed its own working agreement with hospitals across the state.Roughly 13,000 uninsured adults covered by the state-run Charter Oak Health Plan now can get hospital treatment in all eight counties. Twenty of the state's 32 hospitals are now signed up. Windham Hospital, Day Kimball Healthcare in Putnam and Middlesex Hospital have signed contracts with Charter Oak since late January, the attorney general's office announced this week.

The contracts were signed after Attorney General Richard Blumenthal reached an agreement with the largest insurer, Anthem Blue Cross and Blue Shield in Connecticut. But a spokeswoman for Day Kimball Healthcare said Blumenthal's intervention was not a factor in the hospital's contracting with Charter Oak. A Windham spokesman said reimbursement rates were a factor.

Anthem's contracts with hospitals includes a "most favored nation" clause that requires the hospitals to offer Anthem the same rate it extends to other insurers, or a better one. Anthem agreed to exempt the Charter Oak Health Plan.That clause had made it difficult for Charter Oak to secure contracts with hospitals, because it required a hospital to offer Anthem rates as low as those offered to Charter Oak patients.

Hospitals could not afford to drop Anthem, which insures 1.5 million in Connecticut, in order to treat Charter Oak patients.

"As Attorney General Blumenthal indicated," Anthem spokeswoman Sarah Yeager said, "Anthem Blue Cross and Blue Shield cooperated with his office to address potential concerns that clauses in Anthem's participating hospital contracts might deter hospitals from participating in the Charter Oak health plan."

In 2008, the state started offering the Charter Oak Health Plan to provide coverage to uninsured adults between the ages of 19 and 64. The state contracted with three private insurance plans — Aetna Better Health, AmeriChoice by UnitedHealthcare, and the Community Health Network — to manage networks of doctors and hospitals for the Charter Oak plan.

Blumenthal's office is still investigating how Anthem's most-favored-nation clause is affecting competitors. He commended Anthem for its continued cooperation in the antitrust investigation.