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Sep 22, 2009 3:42 PMPublication: The East Hampton Press

Local brokers skeptical Empire and Alliance will settle

Sep 22, 2009 3:42 PM

Negotiations between Empire Blue Cross Blue Shield and the East End Health Alliance dragged into an eighth week on Monday, and there appears to be no end in sight to the impasse.

Both sides remained far apart on the issue of how much money hospitals should be reimbursed for care given to Empire subscribing patients. Alliance hospitals have demanded a 40-to-60-percent rate increase over last year, saying they actually lost money when treating Empire patients due to low reimbursement rates, while Empire has claimed that hospitals are asking for more than their fair share.

“Obviously, they remain apart from our proposals,” Alliance spokesman Paul Connor III said this week. “We have not found a way to reach an agreement.”

Alliance hospitals—Southampton Hospital, Peconic Bay Medical Center in Riverhead, and Eastern Long Island Hospital in Greenport—went out of Empire’s network on August 1. Last month, the hospitals and Empire reached a settlement on rates in Empire’s Mediblue plan for seniors, but other Empire plans are still not accepted at Alliance hospitals except in cases of emergency and for approved procedures and treatment.

The contract impasse has affected thousands of Empire subscribers across the East End, from municipal employees to private sector employees who get their insurance through their job. Empire was the largest insurer of patients at the three East End hospitals, covering approximately 40 percent of the patients treated.

Area insurance brokers with clients who subscribe to Empire are skeptical that a deal will be reached.

Following a meeting between brokers and Alliance representatives in Riverhead on Wednesday, September 16, Karl Washwick, owner of Washwick Agency in Riverhead, said he doubted Empire would raise its rates to meet hospital demands. The meeting was held to update brokers on the status of the negotiations.

“I don’t think there is going to be a deal—I think both sides are too far apart,” said Mr. Washwick, who represents more than 300 clients with Empire insurance. “They’re not movable on the price.”

Anthony Cardona, a broker for Maran Corporate Risk Associates of Southampton, noted that “both sides are light years apart” and said, “There is really not much of a middle ground.”

“It seemed like both parties were leaning toward no [deal],” Mr. Cardona said.

Negotiating teams for Empire and Alliance were expected to hold a telephone conference later this week to continue negotiations.

So far, insurance brokers have urged concerned clients to wait for both sides to reach an agreement before switching insurance plans. But Mr. Cardona and Mr. Washwick said clients may begin switching soon.

“If no agreement is reached,” Mr. Cardona said, “I can imagine that people will start exercising that option.”

“My gut feeling is that everybody is going to switch,” Mr. Washwick said.

Some Southampton small-business owners said this week they were waiting for word on an settlement before making a switch. Others already canceled their Empire plan for another provider.

Jean Loper, a financial administrator for Hampton Dental Group in Southampton, said the group is “holding” with Empire for now. “We don’t have any date in mind to say that if it’s not resolved by this date, we are definitely going to change,” Ms. Loper said.

But Ken Rothwell, owner of O’Connell Funeral Home in Southampton Village, said he switched from Empire to Emblem Health in June when Empire raised his premium by $200, from $1,200 to $1,400. He was also concerned that East End hospitals would be dropped from Empire’s network, Mr. Rothwell said.

“Their rates were sky high,” Mr. Rothwell said. “Why pay a top premium for a health insurance company that is not serving you?”

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Let's stop protecting health insurance companies and start caring for our citizens.
By dagdavid (646), southampton on Sep 22, 09 4:02 PM
Who's protecting the insurance companies? What are you talking about? Your comment has nothing to do with the article
By razza5350 (1911), East Hampton on Sep 22, 09 4:23 PM
I don't see a light at the end of the tunnel. What I don't understand is that there are not any intelligent attorneys in New York that are smart enough to start a class action lawsuit against both sides. Both sides are putting the 40% of the East End population that have Empire BC/BS in a position where they have to find doctors in Port Jefferson and further west to get any services performed in a hospital for non-emergencies. In addition, the lawsuit could force Empire to lower their premiums ...more
By bobalooey (45), East Quogue on Oct 1, 09 3:39 PM