Grady at Medicaid impasse with insurer

By Craig Schneider

The Atlanta Journal-Constitution

The insurer that handles Medicaid for Grady Memorial Hospital said it will terminate the hospital's contract Saturday, The Atlanta Journal-Constitution has learned.

Peach State Health Plan is an insurer hired by the state of Georgia to handle Medicaid claims with numerous health care providers, including a portion of Grady patients.

While Grady and Peach State have agreed that Grady will continue to serve these patients until Dec. 31, the termination – if it becomes effective – could represent a change in medical services for thousands of Grady patients.

The patients would have to find new doctors at a new medical facility, said Grady spokesman Matt Gove. Many have been coming to Grady for years, have long relationships with their doctors and have transportation issues that could limit going elsewhere, he said.

"This would be a disruption in the medical care of thousands of people," Gove said.

Peach State officials sent a letter to state legislators Wednesday saying, "We regret to inform you that, after months of negotiations, Grady Health System will no longer be a contracted Peach State provider effective Nov. 28, 2009."

Peach State will notify these patients prior to Dec. 1, the letter said. Peach State said the change would affect 2,182 patients, but Grady officials said the number is more than 12,000, a small percentage of the hospital's patient population.

It remains unclear whether the two sides will return to negotiations before the end of the year, though Gove said that is "highly unlikely."

The impasse in negotiations between Grady and the company reflects other intense negotiations between insurers and hospitals in metro Atlanta. The great majority work out an agreement at the end.

Peach State officials said patients will not have their care interrupted.

"Patients who are pregnant, receiving chemotherapy, dialysis ... may remain at Grady until their course of care is completed or until alternate care arrangements are made," the Peach State letter said.

Peach State has set up a hotline for patients' questions, at 1-866-229-2892.

Grady also accepts Medicaid from the two other insurers hired by the state to handle Medicaid. Peach State patients can attempt to switch insurers on their annual renewal date.

Peach State said Grady has already increased its charges to the insurer twice this year and has demanded a third increase.

"Such unchecked price increases are clearly unsustainable," said the Peach State letter.

Grady's Gove said Grady has been attempting to match its charges to market rates.