PROVIDENCE — Lifespan Corp., the state’s largest healthcare system, may no longer accept Cigna Healthcare insurance after April 1 as ongoing contract negotiations between the two companies have stalled.
Rhode Islanders who pay for Cigna’s commercial plans received letters from Cigna saying that the insurance company has been working to renew its contract with Lifespan over the past few months.
“Our goal is to reach an agreement that keeps your health care affordable,” read the letter dated March 1, which was obtained by the Globe. “Unfortunately, despite our best efforts, we haven’t reached an agreement yet.”
Payer and provider negotiations have become heated in recent years as providers face rising health costs. Payers, which are insurance companies, feel the pressure to cap premiums, and healthcare providers are pushing back against the limits.
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Healthcare providers and hospital systems do not charge every patient the same rate for services. Insurance companies, including Cigna, negotiate pay rates with providers; when they reach a deal, the provider is considered “in network.” And if there is no deal, the provider is considered “out of network.” Patients who go to hospitals that are not in their insurance company’s network usually have to pay more out of pocket for services.
Jocelyn Parker, a Cigna spokesperson, said the company is hoping to reach an agreement by March 31.
“Good faith negotiations are continuing with Lifespan on a fair, reasonable contract in line with other local providers that will keep health care affordable for our customers and their families,” said Parker in a statement.
Lifespan spokeswoman Kathleen Hart said in a statement that the health system is in discussions with Cigna to remain in their network and continue offering care to their members.
“In the event our contract with Cigna is not renewed, Lifespan is committed to providing continuity of care for our patients who are Cigna members until they transition to other care and coverage options,” said Hart.
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Lifespan owns Rhode Island, Hasbro Children’s, The Miriam, and Newport hospitals. Rhode Island Hospital is the state’s only Level 1 trauma center.
Cigna is not Rhode Island’s primary health insurer, but hundreds of households may be forced to find a new doctor if the companies cannot reach a deal.
If an agreement is not reached, those with insurance through Cigna may have to pay more for the same services at Lifespan’s hospitals than they do now. In its letter to customers, Cigna warned that patients could pay “much more,” as much as “100 percent of the cost” if their plan does not have an out-of-network benefit.
“If Lifespan does leave the network, you may want to find a new, in-network hospital — and we’re happy to help you do that,” Cigna wrote in its letter, and attached a list of five nearby hospitals.
If a deal is reached between Cigna and Lifespan, the contract will need to be reviewed and approved by the state’s Office of the Health Insurance Commissioner.
Cigna just recently struck a multiyear deal with Trinity Health of New England after months of contentious negotiations that disrupted the coverage of patients, and left them out of network for two months.
This story has been updated with comments from Cigna’s spokesperson.
Alexa Gagosz can be reached at alexa.gagosz@globe.com. Follow her @alexagagosz and on Instagram @AlexaGagosz.