Kenosha, Wis.-based Froedtert South will not renew its contract with Envision Healthcare when it expires June 30, the Milwaukee Business Journal reported May 16.
Froedtert South has used physicians, physician assistants and nurse practitioners from Envision — which recently filed for bankruptcy — and its predecessor companies for years, but has decided to switch to Vituity, a California-based firm that will retain Envision's local providers, CEO Ric Schmidt told the publication.
Envision has been unable to resolve a lengthy legal battle with UnitedHealthcare, which is a major insurer in Kenosha County, according to Mr. Schmidt.
When Envision acquired Infinity HealthCare, a Milwaukee-based physician group, Infinity said it supplied physicians to Ascension Wisconsin and Froedtert Health hospitals, according to the Milwaukee Business Journal.
A spokesperson for Froedtert Health, a minority owner of Froedtert South, said that the system no longer uses Envision. Ascension did not immediately respond to Becker's request for comment.
Nashville, Tenn.-based Envision's physician services business to 139 health systems in multiple specialties and directly or indirectly employs about 17,000 providers.
On May 14, Envision filed for bankruptcy, citing various financial challenges that included payers excluding Envision clinicians from their networks and not providing adequate reimbursement for care, the implementation of the No Surprises Act, rising inflation and the national clinician shortage.
Envision has entered into a restructuring support agreement with key stakeholders supported by more than 60 percent of the company's $7.7 billion in debt obligations, but plans to continue to provide patient care for its client health systems during the Chapter 11 case.
Pending court approval, the company will use cash generated by operations to fund expenses, including supplier obligations and employee compensation during the restructuring process.