In the most recent of a string of contract disputes to go public, both Cigna and Hospital of Central Connecticut in New Britain are still refusing to budge on a new contract that starts next month.
Hospitals have been counting on private payors to make up for losses from Medicare and Medicaid. For each dollar of cost Connecticut hospitals incurred in 2009, they received 87 cents from Medicare, 70 cents from Medicaid and $1.22 from private insurance, according to a state report.
Payors, however, have been balking on covering Medicare and Medicaid costs. Influential observers, including MedPAC and Milliman, argue new efficiencies could help hospitals break even on Medicare, at least, and hospitals appear to be open to that argument.
Kurt Barwis, president and CEO of Bristol Hospital, which has had a number of recent contract disputes with payors, said it is time to find a new payment model that recognizes efficiencies. The hospital has been introducing efficiencies in areas like supply chain management. Hartford Hospital has been focusing on reducing readmissions and bloodstream infections.
An Aetna official said the company has been introducing new payment models that reward efficiency, and providers are showing great interest. Aetna has signed pay-for-performance agreements with hospitals and large physician groups that call for lowering readmissions or making sure patients get health screenings.
Read the Connecticut Mirror report on hospital payments.
Read more coverage of contract disputes with payors:
– 10 Hospitals and Health Systems in Recent Disputes With Payors
– 96 Questions to Ask When Reviewing Managed Care Contracts
– Massachusetts Report Finds Hospitals’ Negotiating Clout With Insurers Drives Up Costs
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