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‘26,000 may be affected’: St. Charles’ possible Medicare Advantage withdrawal prompts questions, concerns

(Update: Adding video, comments from St. Charles, patients, insurers, Summit Health)

Hospital system urges signing up for traditional Medicare; Summit Health critical of possible move

BEND, Ore. (KTVZ) -- Citing concerns related to patient care, access and affordability, St. Charles Health System says it may withdraw its participation in all Medicare Advantage plans, including those from Humana, PacificSource, HealthNet and WellCare, and urged participants to consider shifting to traditional Medicare.  That has prompted concerns by patients and others, including Summit Health Oregon.

St. Charles said in Monday's announcement that if it makes that move, it will continue to accept original (or traditional) Medicare, which is funded and operated by the federal government. Medicare Advantage plans are funded by the government but run by private insurance companies. 

Henrik Jahn, president of InsureBend, told us on Friday, "I have my own clients with this (Medicare Advantage) insurance, about 1,500. But I know about 26,000 may be affected by this in Central Oregon."

St. Charles Health System officials explained to NewsChannel 21 on Friday why they are considering the move.

Chief Financial Officer Matt Swafford said, "Often what happens is that the Medicare Advantage plan gets in the way of the patient and the provider and makes choices that either delay a discharge or prevent access or change the financial situation retroactively, after the care has already been provided."

St. Charles also cited the burden of paperwork, staffing shortages and delays in transferring patients as more reasons to potentially drop Medicare Advantage coverage.

Dr. Mark Hallett, the system's chief clinical officer, explained more scenarios where the Medicare Advantage insurance plans don't cover what people think they do.

"We also see them financially disadvantaged when we get denials for the services that the patients needed that have already been delivered, which puts them in a real awkward position," he said.

PacificSource Health Plans currently has 15,000 people on their Medicare Advantage plans, according to Jeremy Vandehey, Oregon market president.

"We also have about 2,500 members who are both on what we call 'Medicare-Medicaid dual' individuals that are some of the most vulnerable folks in our community who are both low-income and oftentimes have a disability as well," he said.

Medicare Advantage insurance holder Kate Bailey told us, "I think it'll be a financial burden for a lot of people, because PacificSource is 'free."

She's lived in Bend for over 20 years, and has had had a Medicare Advantage plan to help her with unexpected medical costs, along with dental, vision and hearing services.

"(If) we don't have that, then we have to go back to Medicare and get their Part D, get some other 'gap coverage' kind of thing, and it's going to be very expensive, very time-consuming. And I think the customer service will go out the window."

Some think there may be a way for St. Charles to keep Medicare Advantage insurance with fewer issues. Mike Gonsalves, who is on a plan, said, "My suggestion would be to use the Central Oregon Health Council as a negotiator, to help work out those operational differences. Otherwise, you're going to put the most at-risk population in the region at risk."

InsureBend's Jahn told us, "With original Medicare, there is no limit to the out-of-pocket expense to the individual, whereas the Advantage plans are required to have a maximum for the patient."

St. Charles said it expects to make a decision by early fall and that patients would receive a minimum of 30 days' notice through their insurer.

Swafford concluded, "It's important to elevate the care of providers and caregivers that are in short supply and are quite valuable, and need to be here in order to provide the care the community needs."

The enrollment period for Medicare coverage is from Oct. 15-Dec. 7.

If St. Charles chooses to drop Medicare Advantage plans, the change could take effect as soon as this fall.

Dr. Steve Gordon, President and CEO of St. Charles, explained in Monday's announcement that great thought went into the decision to reevaluate Medicare Advantage participation, and it was done only after years of concerns piled up not just at St. Charles, but at health systems throughout the country.

“The reality of Medicare Advantage in Central Oregon is that it just hasn’t lived up to the promise," Gordon said. " A program intended to promote seamless and higher-quality care has instead become a fragmented patchwork of administrative delays, denials, and frustrations. The sicker you are, the more hurdles you and your care teams face. Our insurance partners need to do better, especially when nurses, physicians and other caregivers are reporting high levels of burnout and job dissatisfaction.”

St. Charles is not alone in expressing concerns about Medicare Advantage plans. According to the American Hospital Association, the AHA “is increasingly concerned about certain (Medicare Advantage) plan policies that restrict or delay patient access to care, which also add cost and burden to the health care system.” Additionally, Medicare Advantage plans are under investigation for fraud and delays and denials in coverage

“We are seeing different outcomes for patients based on the type of insurance they have; with those on Medicare Advantage experiencing higher rates of denials and longer hospital stays, meanwhile our providers must jump through hoops in order to get the care their patients need approved,” said Matt Swafford, chief financial officer for St. Charles.

“We recognize changing insurance options may create a temporary burden for Central Oregonians who are currently on a Medicare Advantage plan, but we ultimately believe it is the right move for patients and for our health system to be sustainable into the future to encourage patients to move away from Medicare Advantage plans as they currently exist. We want to share this notification with seniors in Central Oregon so they have enough time during open enrollment this fall to sign up for traditional Medicare.” 

Next steps

St. Charles Health System said it is evaluating its Medicare Advantage contracts with PacificSource, Humana, HealthNet and WellCare this fall and winter.  

Should St. Charles no longer be considered “in-network” with these Medicare Advantage plans, patients who are currently on these plans may need to choose another insurance plan to avoid changes in insurance coverage or payment responsibilities, officials said. Patients who may be impacted by this change will receive a letter from St. Charles in the mail in the coming weeks. 

“We strongly encourage anyone currently on a Medicare Advantage plan living in Central Oregon to review their health insurance coverage during open enrollment this fall and consider making a change to traditional Medicare,” said Dr. Mark Hallett, chief clinical officer for St. Charles.

“When a patient is on traditional Medicare, physicians determine a patient’s care and what is medically necessary. When a patient is on a Medicare Advantage plan, the insurer determines what is medically necessary. Medicare Advantage plans provide great benefits for people who are healthy, but we are concerned patients may not understand the barriers to care they could experience on an MA plan if they are seriously ill or require hospitalization.” 

Central Oregonians who wish to explore insurance options can contact: 

  • Oregon Senior Health Insurance Benefits Assistance (SHIBA) at 800-722-4134, option 2, 
  • 800-MEDICARE (800-633-4227), 
  • Council on Aging of Central Oregon at 541-678-5783,
  • or an insurance broker of your choosing.

On Friday, Summit Health Oregon patients received this notice about the situation and their concerns about St. Charles' plans:

To All Summit Health Oregon Patients: Central Oregon Medicare Advantage Plans

Summit Health's leadership team has been closely following the announcement by St. Charles Health System that it may end its participation in all Medicare Advantage contracts in the next four months. This unilateral decision by hospital leadership would significantly impact well over 25,000 Central Oregon seniors, creating significant, unintended consequences for our community.

As the premier Primary and Specialty Care provider in Central Oregon, Summit Health provides medical services to nearly 50,000 Medicare and Medicare Advantage patients annually. We want to take a few moments and share our perspective on this unprecedented development in our community, with our patients.

For over a decade, our medical group's providers have worked closely with nearly all Medicare Advantage providers in Central Oregon. Many of Advantage plans, including Regence Providence, Moda, Humana and Pacific Source, work with Summit's providers and staff routinely to focus on improving the delivery of care and enhancing the quality of life for all of the patients we serve. These unique partnerships with certain local health plan payers like Pacific Source and Humana have transformed Summit Health's entire care delivery model – producing some of the best healthcare outcomes in America.

In 2022-2023, Summit Health in Oregon produced a perfect 100% Medicare quality score (MIPS) and averaged a 4.8-star rating on most Medicare Advantage plans while maintaining our 95% customer satisfaction rating for over three years. Our on-going partnership with these local health plans has been vital in creating extraordinary outcomes for patients.

Here are a few examples of collaboration between the health plans and Summit Health:

During the pandemic, when Central Oregon faced unprecedented inpatient bed capacity challenges, Pacific Source partnered with Summit Health to launch a first-of-its kind skilled nursing facility program. This new service helped patients transition from hospitals to transitional care facilities, and back to their homes, in a coordinated system of care. This collaboration significantly reduced the length of stay and unneeded readmissions.

To reduce the impact of expensive lifesaving oncology and rheumatology medications, Summit Health, Humana, and Pacific Source came together to launch a new drug waste reduction and biosimilar utilization initiative in 2021. This new initiative utilized best practice treatments and data sets and enhanced the collaboration between pharmacists and physicians. Thanks to this partnership, Summit Health has one of the highest Bio-Similar utilization rates in the Pacific Northwest and has saved patients well over $500,000 annually in drug waste reduction.

In 2022, during the peak of the national staffing crisis, Summit Health met monthly with Pacific Source and Humana to highlight the administrative burden of the authorizations process. Through our collaborative partnership with local health plan leaders, along with multiple innovative workflow changes, Summit Health was able to streamline our processes and dramatically reduce the authorization burden with these plans. Patients get in to see their healthcare provider faster because of this valuable process improvement.

Over the past decade, Summit Health and the Medicare Advantage Plans have worked together on dozens of projects and collaborations just like the ones discussed above. The Medicare Advantage plans in the market have worked extremely hard with us to expand benefits and services including offering meal support, transportation, and expanded preventative care within their plans. Summit Health believes Medicare Advantage plans can, and do, offer tremendous benefits for many patients based on their needs and lifestyle.

If the leadership at St. Charles Health System unilaterally ends its Medicare Advantage contracts in the coming weeks, that will have serious consequences for tens of thousands of seniors in Central Oregon. This action may include increased out-of-pocket costs, diminished access to vital medical services, limited primary care availability, disruptions in care, challenges finding supplemental plans, and unnecessary emotional stress.

We're eager for an explanation of the reasoning behind this decision, which could place thousands of Oregon seniors at greater risk. We're encouraging St. Charles Health System to put the health of seniors in our community first when they are making the decision whether to drop their relationship with many patients' chosen insurance plans. We hope St. Charles leaders will recognize that when health plans, provider groups, and hospitals come together to cooperate, the patients are the ones who really win.

Irrespective of St Charles decision, Summit Health remains dedicated to you, our patients, and the community. We will navigate the outcome of the hospital's decision together and appreciate the opportunity to share our thoughts on this issue with all of you.

Summit Health

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Blake Mayfield

Blake Mayfield is a multimedia journalist for NewsChannel 21. Learn more about Blake here.


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