For Chicago-area customers of managed-care giant UnitedHealth Group, some hospitals and certain doctors affiliated with Advocate Health Care will not be showing up on UnitedHealth’s list of providers anytime soon.
A high-profile rift that began two years ago returned to the stage recently after a private arbitration panel ruled against United’s antitrust complaint naming Oak Brook-based Advocate, the Chicago area’s largest provider of medical care.
United’s United Healthcare of Illinois Inc. subsidiary and Advocate parted ways two years ago in a dispute about rates paid by the insurer to Advocate doctors and hospitals. In the dispute, United lobbed allegations of price-fixing and antitrust violations against Advocate in what Advocate contends was an effort to force more than 600 employed physicians and its eight hospitals to be paid lower rates. United also wanted more than $250 million in damages, Advocate said.
But a private arbitration panel recently ruled in Advocate’s favor, dismissing all counts against the medical-care provider.
The antitrust allegations were arbitrated by a three-person panel of the American Arbitration Association, which adjudicates private commercial cases and labor disputes.
The insurer said in a news release it’s hopeful a “new relationship that is beneficial for its customers can be established with Advocate.”
Yet neither Advocate nor United can say when, or if, there will be negotiations. That means United customers will have to pay steeper rates if they want to use Advocate facilities and Advocate-employed doctors.
Two years ago, more than 40,000 of United’s customers were affected. Many had to choose new doctors and hospitals, although neither side can say for sure how many chose new providers in United’s networks or eventually switched insurance plans to maintain access to Advocate providers.
The bitter negotiations are still fresh in the minds of Advocate executives.
“It was hardball,” said Dr. Lee Sacks, executive vice president and chief medical officer at Advocate.
Neither side would disclose the specific rate increases or percentages being discussed.
“We continue to be open to having a contract with United,” Sacks said.
“We have not heard from United since the arbitration verdict. Time will tell.”
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