PCI could cut ties with two of Iowa’s private Medicaid insurers

CEDAR RAPIDS - Payment disputes have pushed Physicians' Clinic of Iowa to threaten to terminate contracts with two of the state's three private Medicaid insurers if the concerns are not soon corrected.

In letters sent to Amerigroup Iowa and AmeriHealth Caritas Iowa, PCI - one of the state's largest private physician groups - told the insurers that failure to consistently pay provider claims properly or in a timely manner have led the medical provider to send a notice of breach of contract.

PCI told Amerigroup it must correct issues within 30 days and AmeriHealth it must fix issues within 60 days or the provider no longer will see patients of either insurer starting on Sept. 1.

'It is not our intent to terminate relationships or reduce access,” said Eric Dalton, chief financial officer of PCI. 'But we wanted to bring attention to these issues through filing a breach of contract because we have exhausted all other efforts.”

About six percent of PCI's patient base is on Medicaid, Dalton said, with about 5,500 patients receiving procedures in the past 13 months through Amerigroup or AmeriHealth. The medical provider is owed several hundred thousand dollars, he added.

What's more, 'the time and energy our staff spends chasing these problems - they are not issues we face with any other payer, including UnitedHealthcare,” Iowa's third Medicaid insurer, Dalton said

The state handed over its nearly $5 billion Medicaid program to the three managed-care organizations more than one year ago. But payment problems have continued to plague providers across the state, who have complained of late and inaccurate payments.

PCI is not the first large-scale provider to run into contractual disputes with the insurers. Des Moines Register reported in March that AmeriHealth sent a letter to Mercy Health Network stating it would terminate their contract if a new agreement was not negotiated by July 1.

Amy McCoy, spokeswoman for the Department of Human Services, said the state agency is continuing to monitor the state's provider network.

AmeriHealth did not respond to The Gazette's request for comment. Amerigroup said it could not comment on the specific issue as it has not received the letter yet.

All three insurers have reported losses in excess of $100 million during their first year of operation in Iowa, with AmeriHealth Caritas Iowa suffering the greatest loss of nearly $300 million. Amerigroup Iowa reported a loss of $133 million, and UnitedHealthcare of the River Valley said it lost more than $100 million.

It was revealed in March that the state would establish a risk corridor for the Medicaid expansion population and the long-term services and supports population, one of the most costly groups of Medicaid beneficiaries.

In a risk corridor, the government would step in to help protect insurers from unexpectedly high losses by paying the difference if an insurer spends more in medical care than it collects in revenue.

l Comments: (319) 398-8331; chelsea.keenan@thegazette.com