Contract Dispute Disrupts Families' Coverage

Colleen Snyder of Linden, Va., got angry when Children's National Medical Center suggested this month that she consider switching health insurers. The problem: "My husband's open enrollment is in October," so her family was already committed to CareFirst BlueCross BlueShield for 2003.

Snyder says her 13-year-old son, Alexander, needed surgery twice in the past 18 months. With Children's providing the care and CareFirst paying most of the bills -- about $20,000 for each surgery -- Snyder felt her son was in good hands.

But now Snyder is shopping for new doctors because CareFirst and Children's have failed to renew the contract under which the insurer reimburses the hospital. As a result, Children's will be far more costly for people like Snyder, Julie Klinkner and Elisa Siegel, starting Jan. 1. In some cases, CareFirst will charge its policyholders higher, out-of-network fees for using Children's; in other cases, the insurer won't cover care there at all.

In ads and in the media, the hospital is encouraging its patients to change insurers; the insurer is encouraging its policyholders to change hospitals.

Klinkner, who lives in Gaithersburg, has a daughter with type 1 diabetes. "She's gotten absolutely superb care" at Children's, says Klinkner. CareFirst "should be embarrassed from here to eternity" about the contract termination, says Klinkner, noting the multimillion-dollar payments that CareFirst executives are due to receive if the nonprofit insurer is allowed to sell itself to the for-profit WellPoint Health Networks.

Siegel says that her employer offers only CareFirst coverage and that treatment for her son's blood disorder can generate monthly bills of up to $10,000. "If either side gave a damn," Siegel said in an e-mail, "they would find a way to accommodate the children" who are already being treated at Children's.

Both the insurer and the hospital insist they do give a damn.

"Our goal is to continue to take care of all [CareFirst] patients," says Peter R. Holbrook, Children's chief medical officer. "We're very hopeful that a resolution will be reached" by Dec. 31.

In a statement issued by vice president Bruce Edwards, CareFirst sought to assure its policyholders "that the other hospitals participating in our networks can render the same quality health care they have received at Children's." CareFirst says its members made more than 1,100 inpatient visits to Children's last year; Children's says total visits from CareFirst members during that period totaled nearly 45,000.

Steven B. Larsen, Maryland's insurance commissioner, said last week that he wants to ascertain that the contract problem is not related to the WellPoint deal. And while "I'm not sure we have a direct role in the dispute," he said, the state health department "does regulate what is known as 'network adequacy.' "

-- Tom Graham

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