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EDITORIAL: MWHC & Cigna are both at fault in dispute

EDITORIAL: MWHC & Cigna are both at fault in dispute

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PHOTO: Mary Washington Hospital

IT’S NOT only members of the Virginia Redistricting Commission that can’t seem to agree on anything. Closer to home, a contract dispute between Mary Washington Health Care and insurer Cigna has still not been resolved.

On May 30, the Fredericksburg region’s largest health care provider and one of the nation’s largest insurance companies ended their in-network agreement, leaving up to 15,000 local residents with Cigna insurance in the lurch.

“Until such time that Cigna offers MWHC and the Alliance a fair contract, we will remain out-of-network for Cigna covered patients,” MWHC announced at the time. Of course, what’s “fair” – and for whom—is a matter of interpretation.

In July, MWHC Vice President Eric Fletcher told The Free Lance-Star that the reason for the abrupt separation was that Cigna wanted a 30 percent reduction in charges for patients it insures.

But Cigna spokesperson Holly Fussell said that MWHC was demanding “high rates and [rate] increases” and “refusing to negotiate rates that would keep health care affordable for Cigna customers,” many of whom are current or retired first responders.

The very same month that MWHC terminated its contract with Cigna, Fitch Ratings gave an “A” bond rating on “$78 million of bonds issued by the Fredericksburg Economic Development Authority and about $110 million in bonds issued by the Stafford County Economic Development Authority on behalf of MWHC.”

The bond rating “reflects MWHC’s strong and consistent operating performance and its leading market position in a stable service area. MWHC has demonstrated effective cost management and resilience through the coronavirus pandemic and, with the benefit of CARES Act relief funds, has maintained strong operating performance in fiscal 2020. Fitch expects operating performance will continue to be strong and stable with operating EBITDA [earnings before interest, taxes, depreciation and amortization] margins around 10%.”

In other words, MWHC is in no danger of going broke.

Neither is Cigna. The giant insurance company’s net income (i.e. profit) for just the second quarter of 2021 was $1.5 billion from the $43.1 billion it collected in total revenue from June through August of this year, according to its own financial report. And most of that revenue came from customer premiums—including from the same people in the Fredericksburg region who now have to pay out-of-network costs for any care they get at MWHC.

Cigna has engaged in similar standoffs over the cost of care with Dignity Health in California and Sarasota Memorial Hospital in Florida, so this is nothing new.

Are we to believe that the largest regional health care nonprofit and a multi-billion-dollar national insurance company couldn’t figure out a way to split the difference and allow thousands of local Fredericksburg residents who are insured by Cigna to be treated at Mary Washington and Stafford Hospitals and other MWHC facilities without having to pay exorbitant out-of-network fees?

Of course they could. They just chose not to. They’d both rather leave thousands of patients out in the cold than leave any dollars on the negotiating table. Which says a lot about their real priorities.

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