A typographical error in non-renewal letters signed by Independent Health's CEO and sent to WNY Immediate Care on June 1 is at the crux of a contract disagreement between the two organizations.
On Friday, Independent Health issued a news release that its members would no longer be covered for visits to WNY Immediate Care urgent care centers, effective Jan. 1. Late Monday, the insurer reversed course, saying the provider will remain in its networks after all through 2012.
WNY Immediate Care officials were stunned by the initial announcement, saying it had two signed letters from Dr. Michael Cropp, CEO at the insurer, that ensured a contract was in place through the end of 2012.
In fact, the letters - provided to Business First for review - are worded as "non-renewal" notices, and formally give notice of non-renewal of the network provider agreement and participating ancillary provider agreement, effective "12:01 a.m. December 31st, 2012."
If Independent Health intended to end the contract as it says now, the dates appear to have been typed incorrectly, and should have read "12:01 a.m. January 1st, 2012" or "11:59 p.m. December 31st, 2011."
"With respect to the contractual issue, our position is we maintain a contract with Independent Health that goes to the end of 2012," says Joseph DiVincenzo, vice president and general counsel at The Exigence Group, which operates WNY Immediate Care.
Independent Health late Monday acknowledged the typographical error on the non-renewal letter, but said the company had been "explicit" throughout negotiations about its intention not to renew the agreement unless the community fee schedule was accepted.
The end date of the contract notwithstanding, WNY Immediate Care also took issue with how Independent Health characterized the rate request, citing demands it called "unrealistic and unsustainable" in light of the rising costs of health care. The insurer said companies operating the other 18 urgent-care facilities in the region have accepted its community fee schedule in the last year at rates of nearly half those requested by WNY Immediate Care.
WNY Immediate Care fired back, saying it hadn't requested any increases in its fees since 2005, despite a tripling in premiums by Independent Health during the same time period.
"We aren't asking for a dime more from Independent Health than we were half a decade ago," says DiVincenzo. "We're not proposing an increase."
Instead, DiVincenzo agreed, Independent Health negotiated lower rates with the other urgent-care providers in the region, and now expects WNY Immediate Care to reduce its rates accordingly.
"We're not exactly sure what they pay the other providers in the area," he says. "They view these facilities and the doctors in them as interchangeable parts. But our facilities and the providers in them are significantly different than any other urgent care center in Western New York."
Independent Health says WNY Immediate Care, which has five urgent-care centers in the region, was demanding reimbursement rates of nearly twice the amount paid to other like centers in the region.
Independent Health said in a statement it remains committed to reducing the reimbursement levels. "Independent Health remains committed to negotiating a fee that reduces the costs of care which would be in the best interests of our members, employers and the entire Western New York community."