Important Update for Patients: UAB May Cut Ties with United Healthcare – Here’s What You Need to Know!

Earlier this week, the University of Alabama at Birmingham (UAB) health system announced it is in a contract dispute with United Healthcare, the biggest insurance provider in the U.S. If they can’t reach an agreement, many patients in Alabama could lose in-network access to UAB, the only hospital in the state with a Level 1 trauma center.

United Healthcare claims to cover over 500,000 people in Alabama, while UAB serves about 1.4 million patients statewide. UAB’s CEO, Dawn Bulgarella, mentioned that they are negotiating “in good faith” to find a solution.

Who Would Be Affected?

If the contract ends, it would impact patients at UAB clinics, St. Vincent’s facilities, and services at Children’s of Alabama. Patients with United insurance might have to pay out-of-pocket for care at these locations. This change affects those with both commercial plans and Medicare Advantage. However, those with United PEEHIP plans might see only minor cost differences.

When Will This Happen?

UAB and United have until July 31 to reach an agreement. If not, patients could see denied claims and rising costs starting August 1.

What’s Causing the Dispute?

Both sides are pointing fingers. UAB blames high denial rates and slow payments from United. Conversely, United claims that UAB is among the most expensive health systems in the Southeast, demanding substantial price hikes that could make UAB one of the highest-cost providers in their Medicare Advantage network.

United proposed a 60-day contract extension to allow continued access, but UAB declined, stating they had been trying to engage United for almost a year. They argue that United is already paying below cost for many services, which is a major concern for sustaining their hospital operations.

Bulgarella noted that due to Alabama not expanding Medicaid, UAB provides over $100 million in unpaid care annually. The ongoing tension isn’t new; similar disputes happened in 2019, but both parties reached an agreement just before the deadline.

Is This Just a Local Issue?

No. Hospitals across the U.S. face similar disputes with United. For instance, Huntsville Hospital had a contract termination notice but reached an agreement to stay in-network. Duke Health in North Carolina also pointed out problems with low reimbursement rates and faced a similar challenge, although they resolved theirs later.

What Should Patients Do?

Patients who have questions about their insurance coverage can call the number on the back of their cards or visit UAB’s dedicated website.

This dispute highlights a growing concern over healthcare costs in America. According to a report from the Kaiser Family Foundation, over 40% of Americans have faced unexpected medical bills, underscoring the urgency of transparent healthcare negotiations. As the healthcare landscape evolves, both patients and hospitals are caught in the middle of rising costs and complex insurance negotiations.

For more insights into healthcare costs and policies, check out resources from the Kaiser Family Foundation.

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