Coventry must extend contract with Appalachian Regional Healthcare until Nov. 1, judge rules

Conventry Cares must continue its contract with Appalachian Regional Healthcare through Nov. 1 so the 25,000 Eastern Kentucky Medicaid patients affected don't get "thrown under the bus," a federal judge ruled yesterday.

"The health and well-being of thousands of these patients hang in the balance, and many have already suffered hardships, stress and confusion as a result of Coventry's sudden notice of termination of its contract with ARH," U.S. Senior Judge Karl Forester wrote. "ARH serves a high-risk population in an economically depressed area. If faced with a lengthy and costly trip to visit their primary care physician, many patients will simply forego preventive care, leading to worse health problems, higher risk, and more expensive treatment in the future."

ARH operates eight hospitals and other health clinics in Eastern Kentucky. Coventry, also known as Coventry Health & Life Insurance Company, is "one of three companies the state hired Nov. 1 to manage care for the 560,000 Kentuckians enrolled in the federal-state health care program for the poor and disabled," report Valarie Honeycutt Spears and Beth Musgrave for the Lexington Herald-Leader.

Coventry has since said it has lost $50 million in the first quarter of 2012 in Kentucky and is trying to make up for the losses by renegotiating its contracts across the state. When Coventry said it would terminate its contract with ARH in May, the hospital system filed a lawsuit asking for a preliminary injunction to prevent that from happening. Forester ruled the injunction "essential."

After Nov. 1 this year, Forester said Coventry could terminate its contract but "ordered Coventry to provide ARH a list of its members who have used ARH during the past five years so ARH may contact those patients." Right now, ARH only has a contract with one of the two other managed care organizations. (Read more)