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Hermiston Hospital Letter Could Boost PEBB Enrollment for Moda Health

The letter from Good Shepherd Health Care System warns Umatilla County residents against signing up with Providence Health Plan, telling them they may be on the hook for higher out-of-pocket costs. For 2015, public employees who have been covered by Providence, are now able to shift to a Moda Health plan during the October open enrollment.
October 22, 2014

Just in time for the Public Employee Benefit Board’s open enrollment, Good Shepherd Health Care System, which owns the hospital in Hermiston, has sent out a letter to area residents telling them they’d better think twice before signing up with Providence Health Plan for their 2015 coverage.

“It is unlikely that Good Shepherd will continue to be a preferred provider with Providence Health Plans beginning sometime in 2015. For current Providence Health Plan members, this means that you may be considered out-of-network and incur higher out-of-pocket costs for healthcare services provided by Good Shepherd,” reads the letter, which is not dated but which came in the mail about Oct. 15, smack in the middle of PEBB’s month-long October open enrollment for 2015.

The letter could end up driving public employees who have long been insured by Providence into the arms of a new option -- Moda Health, which was added to the state health insurance contract next year throughout Oregon.

“That tells me I have to go to another plan if I want to use that hospital,” said Greg Clouser, a union official at the American Federation of State, County and Municipal Employees, which represents about 450 workers at the Two Rivers Correctional Institution in Umatilla, nine miles from Hermiston.

The new insurance contract, designed to increase choices for public employees as well as align PEBB’s coordinated care goals more closely to the Oregon Health Plan, offers employees in Eastern Oregon the option of either Providence Health Plan or Moda Health’s Summit Plan, which shares administration and provider networks with the Eastern Oregon coordinated care organization.

But the fine details of the plan put Moda Health at a disadvantage -- the employee share of the premium cost for Moda Health will be 5 percent compared to just 3 percent for the Providence Choice Health Plan, which is nominally cheaper for the state. But if Hermiston residents end up paying higher out-of-pocket costs to use their local hospital, the difference in premium rates becomes close to irrelevant.

Providence was caught off guard after hearing that Good Shepherd could leave its preferred provider network, its account manager, Cash Singleton, told the PEBB board Tuesday. She tried to soothe the nerves of union officials and PEBB board members, promising that  Providence had every intention of keeping Good Shepherd in its network. “We have an ongoing agreement,” she said.

Officials from Good Shepherd did not respond to The Lund Report’s questions about the letter by press time, but Jonathan Nicholas, spokesman for Moda Health, said that his health plan didn’t have any exclusive arrangements with the hospital.

Given the state’s outsized employment role in Umatilla County, the letter could also simply be a means to leverage pressure on the Catholic health insurer to give Good Shepherd a favorable contract. It’s not the only hospital in Umatilla County. Thirty miles away, Pendleton has the 25-bed St. Anthony Hospital, which like Providence is affiliated with the Roman Catholic Church, through Catholic Health Initiatives.

PEBB pays providers much more than federal health programs such as Medicaid and Medicare, helping hospitals cover the higher costs they may incur treating the poor and elderly.

Umatilla County is the 13th-largest county in Oregon, but with two prisons and regional hubs for the Department of Transportation and Department of Human Services, it ranks ninth among all Oregon counties for state employees. PEBB insures 4,400 people in Umatilla County from a pool of 1,400 state workers, more than in much larger counties such as Deschutes, Douglas and Linn.

Public employees have until Oct. 31 to choose a health insurance option. If they’ve already signed up for Providence, but have changed their mind and prefer Moda, federal rules allow them to make corrections until sometime in January, according to Kathy Loretz, deputy administrator.

PEBB’s discussion revealed another, unrelated problem that Providence has had with providers. Many people in Eastern Oregon travel to the Pasco, Wash., area to receive specialty care, and Providence has no contract with Trios, a large medical provider in the Tri Cities, making it difficult for its members to see specialists.

Providence intends to look into this problem, Singleton said, but its Washington contracts are handled by a third-party firm that hasn’t contracted with the Trios physicians.