UnitedHealthcare, HealthPartners reach network deal on Medicare Advantage plans in Minnesota

UnitedHealthcare and HealthPartners ended months of uncertainty Tuesday by announcing a new network contract that preserves in-network access across the health system next year for tens of thousands of seniors in the insurer’s Medicare Advantage health plans.

Minnetonka-based UnitedHealthcare announced the agreement in a message to insurance agents and a statement to the Minnesota Star Tribune, saying that the new agreement “ensures continued, uninterrupted network access” to HealthPartners hospitals, facilities and physicians.

HealthPartners confirmed the contract, saying the agreement addresses the health system’s concerns about the medical claims approval process at UnitedHealthcare. In July, the Bloomington-based health system announced it would drop out of the network next year for UnitedHealthcare Medicare Advantage plans, alleging the nation’s largest health insurer had an excessively high rate of coverage denials and frequently delayed payments for services used by seniors.

The health system, which runs Regions Hospital in St. Paul, Methodist Hospital in St. Louis Park and a large network of clinics operating under the brands HealthPartners and Park Nicollet, said the disruption would have affected about 30,000 people.

“Our renewed relationship with HealthPartners helps ensure continued access to quality, affordable care through a robust network of providers throughout Minnesota and Wisconsin,” the health insurer’s statement said.

HealthPartners said it’s sending a letter to patients apologizing for how the contract impasse in recent months caused uncertainty and stress for many.

“We’d like you to know that we were able to reach an agreement with UnitedHealthcare that addresses our concerns,” the health system says in the letter. “This means HealthPartners will remain an in-network provider in UnitedHealthcare’s Medicare Advantage network in 2025.”

The contract dispute has been a source of frustration for Medicare beneficiaries across the Twin Cities, as seniors tried sorting through mixed messages on everything from the frequency of coverage denials to how the rupture might affect their health care.

Since open enrollment for Medicare health plans started last month, UnitedHealthcare’s online data has been listing health care providers at HealthPartners as in-network for 2025 even though the health system has been insisting there was no network contract.

The UnitedHealthcare-HealthPartners impasse was the largest of six contract disputes announced in recent months between large nonprofits with Minnesota operations and Medicare Advantage insurers, including four with Kentucky-based Humana. In all cases, health care providers cited concerns about coverage denials and payment delays by the health insurers.

The American Hospital Association says Medicare Advantage insurance denials grew significantly last year, creating burdens for health care providers. America’s Health Insurance Plans, a trade group for insurers, says the health plans are increasingly popular in part because beneficiaries are satisfied with their choice of hospitals and doctors.

Neither UnitedHealthcare nor HealthPartners immediately responded Tuesday to questions about how the new contract will address concerns about coverage denials.

Contract negotiations are private, so it’s difficult to outline all the factors that could be driving any particular impasse — or exactly what happened to prompt an agreement between the parties. Market power dynamics often are in the mix, analysts say, as well as financial stresses for insurers and health systems.

Medicare Advantage plans say they’re taking a revenue hit from the federal government, due in part to changes with risk adjustment payments to insurers, while hospitals contend they’re still recovering from recent financial pains including high labor costs.

The deal announced Tuesday is good news for seniors, said Tom Peterson, owner of Twin City Underwriters, an insurance agency based in Arden Hills.

“It’s just so important that the seniors are able to see the doctors that they need to,” Peterson said. “And as somebody who talks to a lot of people who use HealthPartners — they’re not going to give up their doctors, so I’m really glad that a really competitive product in this market has the ability to be written there.”

Open enrollment for Medicare health and drug plans started Oct. 15. Insurance agents say beneficiaries who switched out of UnitedHealthcare over the past few weeks due to concerns about maintaining access to HealthPartners can revert to coverage from United if they want.

“If a senior enrolled in a plan already for 2025, they can switch back to [UnitedHealthcare] during this open enrollment period, as long as they do it on or before Dec. 7,” Kelli Jo Greiner of the Minnesota Board on Aging said via email. “They also will have an option to change Medicare Advantage plans from Jan. 1, 2025-Mar. 31, 2025.”

HealthPartners said its outreach to patients would include seniors in retiree health plans sponsored by employers, such as St. Paul Public Schools, Ramsey County and the city of St. Paul. The school district and county took action last month to give retirees the chance to obtain a Medicare Supplement policy as a more expensive alternative that would preserve access to HealthPartners.

Medicare is a government health insurance program for seniors and younger people with disabilities that covers hospitalization and doctor visits, but not all costs. To handle gaps, many seniors expand the coverage by purchasing a Medicare Supplement from a private insurer plus a separate policy for prescription drugs.

In recent years, a growing number of beneficiaries have opted instead for Medicare Advantage health plans, where the federal government hires insurers to provide for members’ care. These plans typically bundle together coverage for hospital, physician and pharmacy care at a lower monthly premium with annual limits on out-of-pocket costs.

A key tradeoff with Medicare Advantage is that health plans generally have fewer providers in their networks — and networks can change from year to year.

Like HealthPartners, Essentia Health announced this year that the Duluth-based health system would be going out of network in 2025 with UnitedHealthcare Medicare Advantage plans. For Humana Medicare Advantage plans, Essentia also announced plans to go out of network next year, as did Avera Health, North Memorial Health and Sanford Health.