Legacy Health has warned it will cut ties with UnitedHealthcare on September 30 unless the two sides agree on higher payment rates, a split that could push thousands of Portland-area patients out of network for care at some of the region’s busiest hospitals. The dispute centers on reimbursement rates for Legacy’s hospitals, clinics and providers across Portland and southwest Washington, and it comes just months after Legacy weathered a similar standoff with a different insurer.
UnitedHealthcare is Legacy Health’s second-largest payer, according to The Oregonian/OregonLive, and the insurer covers people with employer coverage, individual plans and Medicare Advantage throughout Oregon and the Vancouver area, along with Medicaid members in southwest Washington. Legacy says it served roughly 66,000 UnitedHealthcare-covered patients in Oregon and southwest Washington over the past year. If the contract lapses, most Legacy hospitals, clinics and providers in the Portland metro would leave UnitedHealthcare’s network, though Legacy Silverton Medical Center and several Mid-Willamette Valley clinics have separate UnitedHealthcare contracts and would remain in-network.
Legacy formally issued its notice of contract termination to UnitedHealthcare on August 17, according to Legacy Health, a move the health system says was necessary to avoid an automatic contract renewal at current rates while negotiations continue. Legacy has not disclosed the size of the payment increase it is requesting, but the system says it is seeking a fair, reasonable increase over the next two years. UnitedHealthcare has increased its payments to Legacy significantly in 2024 and 2025, per Legacy officials, though the health system maintains those increases have not kept pace with rising costs.
Legacy Points to Rising Costs, UnitedHealthcare Points to Consumers
Legacy has reported that its overall expenses climbed 50% since 2021 because of inflation and higher labor and supply costs, per Legacy officials. Hospitals broadly argue that higher payments are needed to cover those growing expenses, while insurers counter that higher hospital payments translate into higher premiums and out-of-pocket costs for consumers and employers. UnitedHealthcare has said it prioritizes reaching an agreement that stays affordable for consumers and employers while preserving uninterrupted network access to Legacy’s hospitals and providers, and the insurer says contract talks are continuing in good faith ahead of the deadline, according to The Oregonian/OregonLive…