UMaine System switching to Anthem health insurance despite lingering contract dispute with Northern Light
The University of Maine System is switching to Anthem health insurance for its employees, even though the insurer has been publicly feuding with the state's second largest health system, Northern Light Health, for months. About 15 percent of the university system's employees rely on Northern Light for at least one medical service, the system said.
The university system said the switch will save employees hundreds of dollars on premiums, but unions representing these employees said they are “very concerned.” If Northern Light and Anthem are unable to reach an agreement before the university system’s new health plan takes effect on Jan. 1, the unions said they would begin bargaining proceedings.
Northern Light and Anthem Blue Cross and Blue Shield of Maine have been locked in a contract dispute since this summer. The feud has been contentious, with both sides making public accusations and Gov. Janet Mills stepping in to mediate.
Northern Light and Anthem passed an October 1 deadline to reach an agreement to keep Northern Light patients in-network, but they accepted a 30-day extension to continue contract negotiations. The deadline extension would end next week.
Dr. Guy Hudson, the new CEO of Northern Light, told News Center Maine this week that he was “very positive” they would reach an agreement with Anthem.
In an email to employees on October 8, the University of Maine System said it believed, based on information from both parties, that Anthem and Northern Light would reach an agreement before January 1 that preserves in-network access to providers and facilities.
“In recent weeks, we have been in daily communication with both Anthem and NLH,” the university system said in the email. “While it is true that a deal has not yet been reached, we understand that significant progress has been made in their negotiations, which are actively continuing.”
The letter announced to employees that the current contract with Cigna would expire on December 31, and the system will switch to a three-year contract with Anthem on January 1. The system has more than 2,000 full-time employees.
During a 10-month process, the university system said it put out a request for proposals and received responses from four health insurance providers, including Cigna.
Of those four providers, Anthem “overwhelmingly received the highest evaluation score,” the university system said, because it had the largest network of providers, offered the most user-friendly services, had the lowest premium cost increases and had contracts with other public employers, including the state of Maine and the Maine Education Association Benefits Trust.
Under the Anthem family plan, most employees would save $279 next year, compared with continuing with the Cigna plan, according to the university system. Under the Anthem high-deductible family plan, employees would save $680 next year. The email didn’t provide cost comparisons with other insurers.
The university system also selected Capital Rx for prescription drug benefits.
Leaders from unions representing university faculty, in addition to clerical, office, laboratory, technical and professional staff, said they sent a letter on October 3 recommending the university system stay with Cigna to avoid “the detrimental impacts switching would have on many members” if Anthem and Northern Light don’t reach an agreement.
“The position of union leadership is that a change to Anthem without a contract with Northern Light represents a material change in our negotiated benefits that we cannot support,” said Lydia Savage, president of the Associated Faculties of the Universities of Maine System and a geography professor at the University of Southern Maine.
The university system can decide to switch insurance providers, the unions said. However, about 15 percent of members, many of them working for the system’s flagship university in Orono, may need to use out-of-network providers if there is no agreement between Anthem and Northern Light.
In that case, the labor unions will demand a process called “impact bargaining” to negotiate the effects of a management decision on union members, even if the decision was within the management’s right to make.
“Unions have the right to request this type of negotiation, which focuses on consequences like insurance, severance pay, or changes to working conditions, rather than the decision itself,” Savage said.
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