After six months of stalled negotiations, UF Health and United Healthcare remain at odds over reimbursement rates for Medicaid coverage, leaving nearly 75,000 patients in Gainesville, Jacksonville, and Central Florida facing higher medical costs.
Longest Negotiation Stalemate in UF Health’s History
Dr. Marvin Dewar, CEO and chief medical officer for UF Health Physicians, has decades of experience in healthcare, law, and administration. However, he admits he has never encountered negotiations with an insurer dragging on for this long.
UF Health has been out of network with United Healthcare since September, and while both parties acknowledge some progress, significant gaps remain—particularly regarding Medicaid reimbursements for care provided during the out-of-network period.
The Medicaid Reimbursement Dispute
The primary sticking point in negotiations revolves around whether UF Health will receive payment for Medicaid services rendered while United Healthcare was out of network. Medicaid, a joint federal and state program, assists low-income individuals with medical costs, and in Florida, it is overseen by the Agency for Health Care Administration.
In Duval County alone, 222,897 residents—22.2% of the county’s population—were enrolled in Medicaid as of January 2024, the highest percentage among counties where UF Health operates hospitals.
Rising Healthcare Costs and Insurance Disputes
Beyond Medicaid, UF Health and United remain divided over private insurance reimbursement rates. Dewar asserts that United’s latest offer fails to account for rising healthcare costs since their previous contract.
“I do think United has made progress so that they don’t have us going backward anymore,” Dewar said. “But we may have only moved a tenth of the way toward closing the gap.”
According to Dewar, the issue isn’t just the proposed rates but also United’s history of claim denials. He contends that United rejects 20-30% of UF Health’s claims, forcing the hospital system to fight for reimbursement and causing costly delays.
United Healthcare’s Position
United Healthcare has repeatedly stated that its priority is reaching an agreement that is both affordable and sustainable. In a statement, the company emphasized its efforts to negotiate fairly.
“We have met with UF Health more than a dozen times over the past few weeks, emphasizing our commitment to reaching an agreement that is affordable for both consumers and employers,” United said. “On January 10, we presented a proposal that included significant compromises. We are still awaiting a counterproposal and urge UF Health to share our sense of urgency.”
Despite nine negotiation meetings in the latter half of January, the two sides remain apart.
Industry Trends: Financial Stability and Insurance Access
A recent survey conducted by Strata Decision Technology found that financial stability remains the top concern for hospital financial leaders nationwide. Rising labor costs and the increasing expense of medical services have placed pressure on hospitals to negotiate better reimbursement rates.
The Kaiser Family Foundation (KFF) also reported that while 81% of insured Americans rated their coverage as “good” or “excellent,” 58% faced significant hurdles accessing their insurance benefits, including claim denials and delays. KFF found that such issues often lead to worsening health conditions and increased out-of-pocket costs.
United Healthcare’s History of Claim Denials
In October 2023, Dewar criticized United’s handling of claims, stating the company led the industry in denials. “United leads the health insurance industry—this is leading from behind,” he said. “They reject about a third of the claims that come in, which is a staggering figure.”
United Healthcare refutes these allegations, stating that it approves and pays 90% of claims, with most denials stemming from correctable administrative errors. However, Dewar insists that UF Health’s experience paints a different picture.
A Tragic Development in the Insurance Industry
In an unexpected and tragic turn of events, United Healthcare CEO Brian Thompson was fatally shot in New York City on December 4 while on his way to an investor conference. Reports indicated that bullets recovered from the scene bore the words “defend,” “depose,” and “deny.”
Dewar and UF Health officials expressed their shock and sorrow over the incident. “That’s a tragedy and should not have happened,” Dewar said. “No one should try to justify something like that. He was someone’s father, son, and spouse.”
Thompson’s death ignited a national conversation about insurance claim denials and their impact on healthcare providers and patients. United Healthcare responded with a fact sheet defending its claim approval rates and reaffirming its commitment to resolving outstanding disputes.
Dewar remains firm in his stance that UF Health cannot move forward without addressing the reimbursement gap. “We are not relishing being out of network,” he said. “But that gap needs to be closed. United can do it by increasing reimbursement rates or finding other tangible solutions. There are multiple ways to solve this—we just need action.”
With negotiations stretching into their seventh month, patients and healthcare providers alike are eager for a resolution. Until then, thousands of Floridians will continue paying significantly higher out-of-pocket costs for medical care.
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