IU Health, UnitedHealthcare reach agreement

Many Indiana University Health patients are taking their first deep breaths in more than a month.

IU Health announced Thursday that it has reached a new two-year provider contract with major insurer UnitedHealthcare, ending a 35-day stalemate that threatened to disrupt medical coverage for thousands of Central Indiana patients.

The new agreement will be retroactive to Jan. 1, when the old contract expired, the Indianapolis hospital network said in a news release.

"While we are pleased to have reached an agreement with UnitedHealthcare," said Dr. John C. Kohne, chief medical officer for IU Health, "it's unfortunate that our patients experienced any unnecessary stress or inconvenience."

The new provider deal means UHC's 400,000 covered members in Indiana will be able to access IU Health's hospital and doctor network without being billed for higher out-of-network fees.

The inability of the two sides to reach a new agreement had many UHC members worried that they would be forced to drop their IU Health doctors and find new health-care providers at other hospital groups and practices.

Minneapolis-based UnitedHealthcare, one of the nation's largest health-benefits companies, released a brief statement confirming the two sides are in accord, or about to be.

"Over the next few days, UnitedHealthcare will be finalizing our formal agreement with IU Health so that our members continue to have uninterrupted access to care and we are able to maintain our relationship with this valued hospital and physician group," the insurer said.

A UnitedHealthcare spokeswoman, Jessica Kostner, didn't answer further questions about the agreement.

Under the new contract, IU Health spokesman Whitney Ertel said, there will "virtually be no changes (for patients) — the same hospitals and doctors, same billing, same practices and procedures."

He said no officials from IU Health were available to talk about the settlement.

During the more than month-long break in the contract, IU Health unilaterally granted UnitedHealthcare patients a lower in-network billing status, and it said it avoided sending out bills for care given after Jan. 1.

Neither side has talked about the sticking points in the negotiations, though a statement this week from IU Health President Dan Evans suggested that UnitedHealthcare was insisting on IU Health lowering its rates more than it was willing to.

In its statement Thursday, IU Health said: "Both parties have made concessions to reach this point. While we are pleased to have concluded negotiations, we would have readily agreed to the final terms in December."

IU Health runs the state's largest hospital network, with 20 hospitals and 1,500 doctors.

The impasse between the two companies coincided with the startup of the federal Affordable Care Act, known as Obamacare, which created a new federally subsidized national health insurance system.

Many health-care providers and health benefits companies are reworking their business models and relationships to adapt to new federal rules and the creation of regionally based insurance offerings.

Call Star reporter Jeff Swiatek at (317) 444-6483. Follow him on Twitter: @JeffSwiatek.