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Contract between UnitedHealthcare, IU Health to expire

December 31, 2013

Indiana University Health and UnitedHealthcare will enter the New Year without a contract.

That would normally mean that UnitedHealthcare’s customers would pay higher prices at IU Health’s hospitals and physician offices.

But IU Health has decided to still give patients the same "in network" co-pays and deductibles that UnitedHealthcare had negotiated under the expiring contracts, keeping patients’ costs the same until a new deal is reached.

IU Health said in a press release it would apply the "in network" discounts only to the patient portions of its bills, not to the portions paid by UnitedHealthcare.

“We know patients value the relationship with their physician and health care team, and we want to help them maintain those relationships without unnecessary disruption,” said Dr. John Kohne, chief medical officer at IU Health, in a prepared statement.

UnitedHealthcare first notified its customers on Dec. 2 that its contracts with IU Health could expire at year end. Such contracts typically shave 30 percent or more off the list prices of a hospital system’s services.

The contract dispute could affect the roughly 400,000 Hoosiers that have employer-based or individually purchased insurance with UnitedHealthcare. That represents about 12 percent of the Indiana commercial market, according to data from Tennessee-based market research firm HealthLeaders-InterStudy.

It’s unclear how many UnitedHealthcare customers are IU Health patients. The biggest impact would likely occur in Lafayette, where UnitedHealthcare claims market share of about 27 percent and where the IU Health Arnett hospital has a major presence.

In the Indianapolis area, where there are roughly 1 million commercially insured customers, UnitedHealthcare’s market share is about 12 percent, or roughly 120,000 members, according to the HealthLeaders-InterStudy data.

IU Health operates 20 hospitals and employs nearly 1,500 physicians around Indiana.

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