Lee Health, UnitedHealthcare dispute puts patients in limbo

Tens of thousands of Southwest Florida patients face uncertainty over their healthcare coverage following Lee Health’s decision to end its commercial and Medicare Advantage contracts with UnitedHealthcare effective Jan. 1, 2027. 

The change would not eliminate patients’ UnitedHealthcare insurance coverage, but it could leave Lee Health and its physicians’ groups out of network, potentially affecting access to care and out-of-pocket costs. Emergency care and certain continuity-of-care exceptions may still apply. 

The uncertainty is especially acute for Medicare Advantage patients, since Medicare Annual Enrollment opened Oct. 15 and closes Dec. 7. 

Private nonprofit Lee Health, the largest healthcare system in the region and one of the largest in the state, says it notified about 50,000 patients by letter in late August about the change. 

Lee Health did not have data immediately available on how many of those patients are from Collier County or other areas outside Lee County. 

In the letter sent to patients, Lee Health said it made the decision after “years of good-faith discussions and efforts to resolve significant concerns,” including the impact it says UnitedHealthcare’s authorization, review and denial processes can have on timely access to medically necessary care. 

The letter also said the healthcare system was owed more than $100 million by UnitedHealthcare in disputed and underpaid claims. 

In mid-October, Lee Health revised that figure to $150 million. 

UnitedHealthcare disputes those claims, saying in a statement that Lee Health’s decision came without advance notice and denying that it owes “more than $100 million” or any amount to Lee Health. The insurer says the allegation is unrelated to commercial or Medicare Advantage contracts and involves a dispute currently proceeding through arbitration. 

Tough negotiations between healthcare systems and insurers are not uncommon, and agreements are often reached just before contracts expire. While Lee Health and UnitedHealthcare disagree over what led to the current impasse, Medicare Advantage patients are left to make insurance coverage decisions without knowing whether the dispute will be resolved before Medicare Annual Enrollment ends Dec. 7. 

Lee Health’s case for terminating UnitedHealthcare  

Dr. Nariman Heshmati, chief clinical officer for Lee Physician Group and Ambulatory Care Services, says the current situation is not a conventional negotiation over reimbursement rates. 

In an interview, Heshmati said Lee Health has “been at the table with them (UnitedHealthcare) for years” over unpaid claims for services delivered and denials of coverage. 

“A third of our medically necessary denials are United, and the majority of those are overturned on appeal,” Heshmati said. “Ultimately, what it came down to is that somebody’s got to speak up for the patients.” 

Heshmati said Lee Health has not gone out of network with an insurer in more than 20 years and that the system views leaving the UnitedHealthcare network as necessary for its long-term ability to provide care for patients. 

Asked if he sees a path forward for resolving the ongoing disputes, Heshmati said, “we need to do more than talk.” 

“We need to see actions that actually improve the relationship, that improve the ability to provide that patient care,” Heshmati said. “Whether it was United or anybody else, we just want the ability that we’re paid for care provided. We want the ability that if a physician has care that they have discussed with a patient that’s in their best interest, they can provide that care without unnecessary prior authorizations or without denials that get overturned later that just delay a patient’s care. 

“That’s the kind of relationship we need.” 

UnitedHealthcare pushes back  

For its part, UnitedHealthcare strongly rebuts Lee Health’s contentions, saying in its statement that the system’s “abrupt” decision to end its commercial and Medicare Advantage contracts at year’s end was unexpected and came “without prior discussions.” 

The statement said UnitedHealthcare believes Lee Health’s actions are related to the system’s out-of-network status for UnitedHealthcare’s Individual Family Plan and that it is “now using patients enrolled in our Medicare Advantage and commercial plans as leverage over something that isn’t related to them.” 

Lee Health is already considered out of network by UnitedHealthcare for its Exchange/Marketplace plans, a separate issue from the commercial and Medicare Advantage contracts scheduled to end Jan. 1. 

“We remain committed to good faith discussions with Lee Health focused on reaching an agreement that preserves network access to the health system,” the statement continued. “We ask that Lee Health share in our commitment to the people we collectively serve and join us at the negotiating table.” 

Asked if Lee Health would return to negotiations with UnitedHealthcare in an effort to stay in network with the insurer, spokesperson Jaclyn Bevis Berger said in a statement that Lee Health “has been at the table with UnitedHealthcare for years, working in good faith to address longstanding concerns involving patient access to care, administrative barriers and payment practices.” 

She said Lee Health “remains responsive to UnitedHealthcare and committed to supporting patients through this transition.” 

If Lee Health goes out of network with UnitedHealthcare on Jan. 1, other area healthcare systems that will remain in network with the insurer for commercial and Medicare Advantage plans in 2027 include Physicians Regional and Naples Comprehensive Health, both in Collier County. 

Brittney Thoman, system director of marketing and public relations for Physicians Regional Healthcare System, said in a statement that the for-profit system’s primary care and specialist physicians “welcome new patients needing our care, including those who are affected by changes in their commercial insurance or Medicare plan networks.” 

NCH Communications Director Shawn McConnell said in a statement that the nonprofit healthcare system, the largest in Collier County, “is here to serve all of Southwest Florida.” McConnell said NCH will continue to accept UnitedHealthcare commercial and Medicare Advantage plans in 2027 and welcomes patients affected by potential network changes. 

NCH trims two Medicare Advantage plans  

Changes in Southwest Florida’s Medicare Advantage landscape are not confined to Lee Health. 

While NCH will continue to be in network with UnitedHealthcare — and several other Medicare Advantage plans — in 2027, the system announced in September that it will no longer accept Cigna Medicare Advantage and Wellcare Medicare Advantage plans. 

NCH said in a statement in late September that, based on billed claims data, the system had identified fewer than 400 members across the two Medicare Advantage plans who may be affected by the change. 

“Given the limited number of members who have received care at NCH locations, we anticipate the overall patient impact will be relatively small,” the statement said. 

NCH said the change was made “with significant consideration and evaluation,” according to a statement from Chief Financial Officer Danny Hogan. 

“By focusing on a select group of Medicare Advantage plans, we can ensure that the plans we partner with truly support high-quality, patient-centered care,” he said.