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April 19, 2016

Insurance Firm Reconciles with UCMC

Land of Lincoln Health, a local health insurance company, and the University of Chicago Medical Center (UCMC) reached an agreement to keep UCMC physicians in its network of providers.

Land of Lincoln Health told its clients in January that it would no longer be covering treatment at UCMC, effective March 1, 2016. Individuals who wanted to remain with their UCMC physicians would have to seek alternate insurance plans, or incur higher out-of-pocket costs.

Two Hyde Park residents, Daniel Blumenthal and Michael Hartzmark, filed a lawsuit against Land of Lincoln Health in early February. They claimed that the insurer was aware of the upcoming split from UCMC, but did not tell them before they purchased their plans. In late March, however, Land of Lincoln Health informed brokers that UCMC will not be dropped from its network after all. According to the Chicago Tribune, Land of Lincoln Health filed court papers in an attempt to dismiss the lawsuit in early April.

Included was an affidavit from Frank Mancuso, the vice president of network development for Land of Lincoln Health. In it, he says that the letter sent out to customers notifying them of the split with UCMC was in fact sent out in error. According to the Chicago Tribune, “Land of Lincoln’s member services ‘did not know about or understand the termination provisions’ in the U. of C. contracts.”

“It has always been Land of Lincoln Health’s full intention to continue offering coverage for the University of Chicago,” Dennis O’Sullivan, a spokesman for Land of Lincoln, told the Becker’s Hospital Review.

Land of Lincoln Health was founded under President Obama’s Affordable Care Act as one of 23 Consumer Operated and Oriented Plans (co-ops). The goal of these plans was to provide more competition, more choice for consumers, and better overall coverage.

The incident with UCMC comes at a time when Land of Lincoln Health, along with many other co-ops, is struggling financially. It has frozen enrollment for 2016 and raised premiums, according to the Chicago Tribune.

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