Point32Health, the owner of Tufts Health Plan and Harvard Pilgrim Health Care, on Tuesday said 9,400 patients at Children’s and 17,000 patients at UMass will no longer be able to see their doctors there as of Jan. 1 with their current insurance. Children’s Hospital gave a different number for the patients affected: about 5,000.
The loss of Children’s and UMass Memorial will affect only a Tufts health plan available to customers who use the state’s online health insurance marketplace. The plan, called Tufts Health Direct, serves lower-income residents and people who receive insurance subsidies.
“Despite our best efforts, we were unable to reach an agreement on a new contract with UMass Memorial Health and Children’s Hospital Boston for our Tufts Health Direct members,” Point32Health spokesman Philip Tracey said in an email. Point32Health will send a letter to all affected members with guidance on how to select new primary care providers or specialists, he said.
Monthly premiums for Tufts Health Public Plans, which include Tufts Health Direct, are among the lowest on offer for individuals through the Massachusetts Health Connector, averaging around $478 , compared to $829 for UnitedHealthCare or $809 for Blue Cross Blue Shield of Massachusetts, according to Health Connector data. Meanwhile, Harvard Pilgrim Health Care’s average monthly premium is about $705.
Neither Children’s, UMass Memorial, nor Point32Health specified how far apart they were on reimbursement rates.
Dr. Eric Dickson, chief executive of UMass Memorial, said “there was no fight” between his health system and Point32Health; the insurer just wanted to pay a lower reimbursement rate than UMass Memorial could afford.
“We would have lost money on every patient we saw and every patient we hospitalized and every patient we operated on,” said Dickson. He was hopeful many affected patients will be able to switch insurers and continue to see their doctors.
In an Oct. 16 letter to patients who had received care at Children’s Hospital, Tufts Health Direct acknowledged the particular challenges of children receiving ongoing treatments, including for cancer and dialysis.
“We know that changing providers can be stressful — we’re here to help you find a new provider in our network who meets your needs,” wrote Michael Fopiano, director of member and provider services at Point32Health. He added that under certain circumstances, patients may be able to receive services through Jan. 30 or longer.
Children’s Hospital in a statement said it was “unable to reach an agreement” with Point32Health.
Point32 Health is also involved in an ongoing contract dispute with Tenet Health Care, a for-profit health system that operates Saint Vincent Hospital in Worcester and MetroWest Medical Center, which has hospitals in Framingham and Natick.
Saint Vincent chief executive Carolyn Jackson, wrote patients on Oct. 16 that they will lose access to their doctors starting Jan. 1 unless Tenet and Point32Health break an impasse in negotiations. Point32Health said the failure to approve a new contract by the end of the year would affect 17,000 of its members on any of its plans, including both Tufts and Harvard Pilgrim and employer-sponsored plans as well as those through Medicaid and Medicare.
Patients expressed concern on Tuesday about a potential disruption to their medical care.
Lynda Le, who lives in Dorchester and says she is insured by Tufts Health Direct, said her children, aged 9 and 6, have a pediatrician affiliated with Boston Children’s Hospital. When they get referred to specialists, those physicians are also at Boston Children’s.
“Children’s Hospital — it’s where I go by default,” she said. “If my kids are sick, the first thing I think of is, ‘Let’s go to Children’s Hospital.’”
Because of how difficult it is to find a new pediatrician, Le said she would opt to switch insurers in order to stay with her children’s doctor.
Allison Blaisdell, a Fitchburg acupuncturist, said she learned last week that Tufts will no longer cover visits with her family’s doctors, who are affiliated with UMass Memorial.
“So now I’m locked in over here, and I would have to completely reestablish care,” if she doesn’t switch insurers, she said.
If she stays with her Tufts plan, her options would be to trek to Boston to see a provider still in her network or pay out of pocket with a UMass Memorial provider closer to home. She could also switch to a different Tufts plan, but “the rates that I got in the mail are astronomical,” she said.
Although it’s possible Tenet and Point32Health could still reach a deal, both sides are hurling accusations at one another. Tenet accused the insurer of negotiating in bad faith.
“For over 6 months, we’ve been trying to renew our contract with Point32Health so we may continue serving” the insurer’s customers, Jackson, of Saint Vincent Hospital, wrote patients. “Based on our discussions so far though, we are not optimistic that we will be able to reach an acceptable agreement in time.”
Point32Health, in turn, blamed Dallas-based Tenet for the impasse. The insurer said it is negotiating in good faith but Tenet has demanded “significant rate increases every year over the course of a multi-year contract.”
Specifically, the insurer alleged Tenet has asked for double-digit annual rate increases in several commercial plans, well above the state’s 3.6 percent benchmark for health care spending increases.
“These demands threaten both the affordability of coverage for people in the Worcester region and access to these two local hospitals,” Point32Health said in a statement. “We understand that as a publicly traded company, Tenet has different priorities than ours, putting shareholders and executives first. Tenet’s stock price rose more than 75 percent in 2023, while the company provided its CEO with more than $18 million in compensation.”
Shelly Weiss Friedberg, a Tenet spokesperson, denied the health care company sought double-digit increases but declined to give specific figures.
David E. Williams, president of the Boston consulting firm Health Business Group, said Tenet and Point32Health should stop pointing fingers at each other and settle the dispute. Patients and employers that provide health insurance, he said, are caught in the middle.
“We’re talking about the rate of inflation in the US being 3 percent overall,” Williams said. “So if I’m a patient or I’m an employer, I want to say to the health plan and the hospital, ‘Figure out a way to keep the price increase at that level. Don’t make it my problem.’”
Point32Health, which was formed in 2021 by the merger of Tufts and Harvard Pilgrim, has suffered serious setbacks recently.
In April 2023, it was targeted in a ransomware attack that sidelined payments to providers and forced the insurer to use manual workarounds to meet some patient needs. The crippling cyberattack not only interrupted operations for months but also battered the company’s financials. For the first six months of 2024, the insurer reported an operating loss of $155 million on $4.7 billion in revenue, according to an Aug. 15 news release.
In October, Point32Health announced that its chief executive, Cain Hayes, was leaving “to pursue other opportunities” after three years leading the company.
The nonprofit Point32Health serves 1.9 million members in Massachusetts, Maine, Connecticut, New Hampshire, and Rhode Island, the insurer said in March.
Jonathan Saltzman can be reached at jonathan.saltzman@globe.com. Dana Gerber can be reached at dana.gerber@globe.com. Follow her @danagerber6.
