Healthcare Dispute Leads to Public Campaign

By Dan Gorenstein on Friday, April 18, 2003.

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Contract disputes between hospitals and insurance companies aren’t all that unusual in New Hampshire.

But the current impasse between Lakes Regional General Healthcare and Anthem Insurance has gotten off to a different start.

Usually, parties keep negotiation details quiet.

Here, both sides have taken their dispute public very aggressively and very early in the negotiations.

And that leaves some observers wondering if this disagreement might end up differently than the others.

NHPR’s Dan Gorenstein reports.

There’s a rule of thumb when it comes to contract negotiations between hospitals and insurance companies in the Granite State.

Don’t negotiate through the press.

But neither Anthem nor LRH Healthcare is following that credo.

The day talks broke down, Anthem fired off a statement to the media.

Company spokesperson Clark Dumont says a national study provided a compelling reason.

Track 16
:03 … the study found that health plans that had not done that found they were being manipulated, coerced, forced into decisions that were not in the best interest of their members. So we did that.

Within 48 hours, LRG Healthcare began its own public relations campaign.

That included this television spot that aired on WMUR-TV.

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In the past three weeks, LRG Healthcare has spent around 25 thousand dollars on tv, radio and newspaper ads.

That’s in addition to direct mail, public forums, a phone hotline, and visits with local businesses.

Chief Financial Officer Henry Lippman says the hospital launched a full-scale public campaign because so much is at stake.

Track 6
2:54 … It is such a serious issue for the long-term, that we have to put everything we have into it. There may be a short-term hit we take, which depletes an already depleted set of resources, but the amount of resources at stake over the long term I think dwarf short term impact if we don’t succeed.

Both sides have used strong language.

LRG Healthcare casts Anthem as a profit driven Fortune 500 Company with little understanding of a small rural hospital.

For its part, Anthem has questioned LRG Healthcare’s ability to run their hospitals.

CEO and President of Concord Hospital Mike Green, who has been involved with similar contract disputes, says he’s surprised to see these statements make the news.

Track 38
:27 …usually the rhetoric and the publicity during that last 30 days…Here we are in the middle of April where you really have these public relations, almost campaigns taking place, which is 3 months before the deadline. That is different. Before, it was always the 11th hour, that’s when you see the headlines.

But the broad exposure is only one factor that makes this contract disagreement unique.

LRG Healthcare has unusually tight connections in its community.

10 years ago, they began setting up clinics to help the uninsured and provide low-cost care.

Lippman says they are banking on that relationship now.

Track 7
12:32 I think we have a resovoir of credibility with a large part of the population based on what we have done in the past unrelated to this issue. It’s social capitol that has been built, that to a certain extent, we are expending, that I think there is a certain level of trust, that we have earned from past things we’ve done in the community.

Given the social connection, given the pr campaign, Concord Hospital President Mike Green concedes this dispute may not be settled.

Track 35
1:30 I can’t speak for Tom Claremont or the folks over at Lakes, I think they would like it to work out, but I think they also are tyring to make sure they are protecting their own economic interest and so they may have drawn the line at a point that is difficult, and more difficult for Anthem to agree to. Consequently, they are more prepared, than other parties have been, to go their separate way from Anthem on a longer term basis.

Despite the hot, public tenor of the negotiations, many New Hampshire healthcare folks expect an agreement, ultimately.

But if there isn’t, Green warns that may change the New Hampshire insurance marketplace dramatically.

For NHPR News, I’m DG.