Carson Tahoe Healthcare: Payments at root of dispute

There's a simple reason that Carson Tahoe Regional Healthcare gave notice that it won't be a preferred provider to members of the Public Employees Benefit Program:

Executives of the Carson City hospital say the organization loses big money when it treats members of the program operated by Hometown Health Partners, the health-coverage arm of Reno-based Renown Health.

And Ed Epperson, the president and chief executive officer of Carson Tahoe Regional Healthcare, says Hometown Health has been slow providing answers to financial questions.

After several weeks of discussion, Carson Tahoe officials told Hometown Health Partners that the Carson City hospital plans to terminate its involvement in the Public Employees Benefit Program on March 15. In the meantime, they said they hope to resume negotiations.

About 4,500 government employees and retirees are covered by the benefit program. Carson Tahoe Regional Healthcare generates about 10 percent of the claims of Public Employees Benefit Program members for in-patient service and about 8 percent of the program's outpatient claims.

Epperson said his organization is paid less in some instances, far less than other hospitals in the region who also care for Public Employees Benefit Program members.

The average payment from the program to the hospital for in-patient treatment, for instance, is $5,299, Epperson said, while payments for in-patient care at Barton Memorial Hospital at South Lake Tahoe from the same health plan average nearly $20,000.

Payments to all other hospitals in the network for the public employees health program, Epperson said, receive payments that are "significantly higher" than those paid to the Carson City hospital.

A second issue, he said, is that the public employees program doesn't include any stop-loss provisions, meaning that Carson Tahoe has written off big amounts more than $100,000 on several occasions after treating public employees program patients. Those costs ultimately must be borne by other patients.

An executive of Hometown Health disagreed with Epperson's position.

"Our primary concern is that there is no disruption in patient care for people potentially affected by Carson Tahoe's actions," said Troy Smith, a vice president with Hometown Health. "Hometown Health negotiated with Carson Tahoe Hospital in good faith and provides reimbursement rates that are competitive and were mutually agreed to. Although it is disappointing CTH has chosen to terminate the agreement, we remain committed to providing access to high quality health care."

Epperson said his hospital is putting together a transition plan in case the contract is terminated. In the first days after the hospital's decision was announced, he said, relatively few plan participants called with worries.