The Medical Society of the State of New York is accusing a major health insurer of withholding payments.
According to the Society’s Executive Vice President Dr. Thomas Lee, the organization is taking Albany's not-for-profit Capital District Physicians' Health Plan to task for withholding tens of millions of dollars owed to community-based medical practices.
“CDPHP was actually a good insurance company locally in the Capital Region, who has long working relationship with the physicians of the Capital Region, and they were happy mutually. More recently, because of their claim of changes to Medicare Wage Index, which impacted, of course, the Medicare hospital part payment, Part A, they have decided to hold back the withholds and not distribute those funds to physicians. And recall, of course, the Part A payment does not impact physicians. It is Part B on the Medicare side. So to say that this is something that the physician practice should be responsible for is really not reasonable, and it undermines the confidence within the insurance industry and the healthcare delivery system, from both a provider, a physician, as well as patient standpoint, that services render will not be paid according to the contracted rate. And I think that's grossly unfair,” Lee said.
CDPHP spokesperson Ali Skinner disputes that characterization:
"CDPHP and our competitors are facing very significant financial pressures. You know, number one is the Medicare Wage Index. This is a mandate by the federal government, which boosted hospital payments here in upstate New York but failed to align Medicare Advantage premiums for not for profit health insurers here in upstate New York. And for CDPHP alone, it's been $150 million dollar hit. At the same time we continue to face mounting financial pressures due to skyrocketing drug costs. That is a big effect on the you know, weight loss medications that have hit the market recently, cell and gene therapies as well as you know, rising hospital costs."
Skinner says CDPHP is in "a tough situation."
"We really empathize and sympathize with our local physician community. You know? We know that those doctors are here to take great care of our members, their patients. And CDPHP has been long committed to this community for over 40 years. So really we understand it's a it's a tough spot that the physicians are in. But CDPHP as a not for profit, community based health insurer is also facing some tough financial challenges," Skinner said.
The disagreement was first reported by the Times Union.
Lee says CDPHP's actions create another barrier to attracting and retaining physicians in the Capital Region and New York to provide patient care.
Skinner says CDPHP members need not worry: the organization's finances are expected to improve "over the next couple of years," and relief from the federal government may come soon thanks to new legislation that addresses reimbursement shortfalls to local Medicare Advantage plans from the Centers for Medicare and Medicaid Services.
"Yeah, we're actually fairly confident we have a new bill that was reintroduced by Congresswoman Claudia Tenney. That bill calls on the CMS to provide financial relief for health insurance companies in upstate New York. So we applaud those efforts from Congresswoman Tenney, as well as our upstate delegation, which has provided bipartisan support for that legislation. And we also have a lot of hope for the new administration under CMS, because we do believe that CMS has the statutory authority to adjust those rates and provide significant relief for upstate plans," said Skinner.
Lee urges CDPHP to find a way to address the issues at hand.
“Go to the root of the problem and solve that problem and craft solutions based on the source and root of the problem, not just broadly apply across the board, just to have a quote unquote balanced budget or whatever the goal might be, because that would not be a fair solution to the various constituents,” he said.
In February, CDPHP reached agreement with the Albany Med Health System on a new two-year contract keeping the system in-network, avoiding any disruption in care for CDPHP members. Separately, CDPHP agreed to reimburse Albany Med for care provided to the insurance company’s members in 2024.
