Healthcare provider feud leads to thousands in unexpected anesthesiology fees for new Charlotte parents

Her first son was born at Novant Presbyterian in September 2017. He was six weeks early, and his NICU stay led to a $100,000 bill. Fortunately, Berry and her husband had met their deductible and out-of-pocket max, so the bulk of the bill was covered by their insurance provider, UnitedHealthcare.

This past spring, though, she gave birth to her second son, also at Novant Presbyterian. One month later, in June, she received an unexpected letter accompanied by an almost $7,000 bill from Providence Anesthesiology Associates — and this one isn’t covered, at least not so far.

That’s because Novant Presbyterian is caught in the middle of a complicated fight between UnitedHealthcare, which insures 1.4 million North Carolinians, and Providence Anesthesiology Associates, which has an exclusive contract to provide anesthesiology services for Novant Health’s Charlotte market. The two parties were in negotiations for almost a year, and they never settled. Starting March 1, PAA’s services were no longer covered by UHC.

Berry says she didn’t know any of this before she delivered her second son. If she had, she might’ve considered alternate pain management options to avoid the $6,813 charge (originally $7,790; UHC covered about $1,000). After all, the epidural for her first childbirth experience was administered by PAA as well, and that one was covered.

Berry’s epidural was more expensive than the average out of network epidural, according to Fair Health. Their calculator shows epidurals in the Charlotte area are about $4,000 out of network.

“It’s just frustrating more than anything,” she said. “Financially it’s not something that we were anticipating.”

Berry and her husband are employed, but if the bill isn’t reduced, they’ll have to make the minimum payment until it’s paid off.

Right now a third party, Data iSight, is handling her dispute with UnitedHealthcare. She first contacted Data iSight in June, and as of August 31 her claim hadn’t been settled. She was told to call for another update in two weeks. And after speaking with a PAA representative over the phone, she says she’s hopeful she won’t be stuck with the bill long term, at least not in full.

Other parents in similar situations couldn’t get through to PAA over the phone, though. (The company’s leadership says patients should reach out to their patient contact, Malikah Hodo, 704-749-5801, ext. 2126.)

“We are doing everything possible to work with patients and limit the effect on patients,” PAA chairman Dr. Jay Duggins told the Agenda this week.

Representatives from UHC and PAA tell different versions of the story behind their negotiations. But for both groups the issue is money.

PAA, a locally owned anesthesiology group, was approached by UHC in September 2019 with a termination notice — meaning UHC was kicking PAA out of its network. Why? UHC representatives told the Agenda that PAA was charging more than double the median rate of network anesthesiologists.

Duggins, though, says UHC’s termination notice was abrupt and unexpected, and ended a 20-plus year relationship between the two parties. PAA leadership says their rates are competitive, and comparable to others in the area. Duggins says UHC’s executives wanted to cut PAA’s reimbursement fee by 60 percent, which would significantly affect their ability to properly care for patients.

“It would cause us to have to make changes in the way we provide care, which would ultimately affect patients,” Duggins said. He added that these changes would be especially damaging during the coronavirus outbreak in Charlotte when safely caring for patients requires additional precautions and money.

PAA and UHC representatives each say the other is at fault for driving up their patients’ medical bills. Duggins says he showed UHC representatives where PAA saved the insurance company more than $7 million and reduced patient opioid use. PAA’s leadership also offered a performance-based contract; UHC did not accept that offer.

A UHC spokesperson says PAA’s higher prices leave patients with significantly higher bills.

“Unfortunately, Providence walked away from the negotiations altogether and is instead using its out-of-network status to take advantage of our members when they’re at their most vulnerable by balance-billing them at egregiously high costs for the services they provide,” a UnitedHealthcare spokesperson said in an email to the Agenda.

UnitedHealth Group, a publicly traded company, saw its second quarter profits rise to $6.6 billion amid the coronavirus pandemic. That’s double the company’s second quarter earnings from 2019.

“We can’t explain why they want a 60 percent reduction all of a sudden, immediately, when they’re profiting the way they’re profiting,” Duggins said. “Other than the fact that they’re trying to make money for their shareholders and not have the patients’ best interest in play.”

Duggins said his anesthesiology group has kept Novant’s hospital executives up to date on negotiations with UHC. A Novant representative did confirm with the Agenda that it had a contract with PAA but did not answer questions about seeking out alternate anesthesiology providers.

Presbyterian has been perched on the hill in Elizabeth since 1918, through several buildings and renovations. Its history is rooted in nursing, and thousands of longtime Charlotte residents have a sentimental attachment to the place after being born there, or seeing their children born there.

More than 4,000 deliveries have taken place there this year, and now some of them will remember the experience for the bills that came afterward.

This dispute comes just two years after the Charlotte area’s other major healthcare provider, Atrium, went through a heated public battle with Southeast Anesthesiology Associates and its corporate owner, Mednax. Ultimately Atrium ended its relationship with that group, and entered a contract with a local vendor, Scope Anesthesia. In 2019, the Observer wrote that patients have saved money as a result.

The difference here, of course, is that the quarrel isn’t between a regional hospital and a national anesthesiology group. Instead this is between a publicly traded insurance company and a local anesthesiology group.

PAA’s leaders say they’re still hopeful the dispute with UHC can be resolved.

“We hope there is an end in sight. We want to get back in network as soon as possible for a whole host of reasons, not least of which is we’re not getting paid correctly,” PAA CEO Mark Casner said. “While there’s a great demand on the patient, we’re trying to work with everybody to resolve this as quickly as we can.”

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