Swedish severing ties to insurer

Swedish Medical Center said it will sever its contract with UnitedHealthcare, the nation's largest health insurer, this fall, a move that could mean higher medical bills for 14,000 families.

Swedish's chief financial officer, Jeff Veilleux, said UnitedHealthcare pays Swedish less than any other commercial insurer and also scores the lowest for accuracy and promptness of payments and other measures.

Swedish has never terminated a contract with an insurer, although it came close to doing so with Aetna in 2001.

"It's a very serious event," Veilleux said. "It's not what we wanted to do."

Swedish began notifying employees and patients Monday that UnitedHealthcare's contract will expire Sept. 8 with 450 Swedish-employed physicians and on Oct. 8 for the four Swedish hospitals on First Hill and in the Central District, Ballard and Issaquah.

After those deadlines, Swedish will be an out-of-network provider for UnitedHealthcare members. That means UnitedHealthcare patients will likely have to pay higher co-pays and a larger share of their medical bills if they continue receiving care through Swedish and its doctors.

Tyler Mason, a spokesman for Minneapolis-based UnitedHealthcare, said the announcement was unexpected because the parties were in the middle of negotiations. Mason said contract disputes are not uncommon, but he said "99.6 percent" of UnitedHealthcare's hospitals renew.

"There is still time" to sign a new contract with Swedish, Mason said. But he said Swedish has asked for "double-digit" payment increases, which would raise premiums for UnitedHealthcare members.

"If we pay them more, our members have to pay more," Mason said.

Local employers who offer coverage through UnitedHealthcare include Wamu, Alaska Airlines, T-mobile, AT&T/Cingular and Wells Fargo. UnitedHealthcare accounts for 7 percent of Swedish's patients, Veilleux said.

One UnitedHealthcare patient, Trent Gillespie of Seattle, said his wife is due to give birth on Oct. 26 at Swedish's First Hill campus, which would be after the contract expires. But Swedish has notified the couple that their current coverage will continue until the baby's birth.

But Gillespie said he isn't reassured. On top of it all, he said that because his family doctor is employed by Swedish, he may have to find a new one unless he is willing to accept lower coverage.

"And I can't afford that," he said.

Kyung Song: 206-464-2423 or ksong@seattletimes.com