Cigna and Fletcher Allen settle contract dispute

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(Host) There’s good news for 85,000 Vermonters who get their health insurance through Cigna health care.

The company and Fletcher Allen Health Care have settled a contract dispute that threatened to leave thousands of people without coverage at the state’s largest hospital.

VPR’s John Dillon reports.

(Dillon) When the contract talks broke down earlier this month, Governor Jim Douglas got on the phone and urged both sides to re-open negotiations.

The governor says the settlement will ease the anxiety for tens of thousands of people around Vermont – including state employees – who worried about being denied coverage for care at Fletcher Allen.

(Douglas) My overall goal is to make sure that Vermonters who are covered by Cigna continue to have that access, and I’m pleased that they’ve reached what I understand is a multi-year agreement.

(Dillon) Earlier this month, Fletcher Allen said it would break its relationship with Cigna. Hospital officials said the current contract did not cover its cost of care.

That’s when the Douglas Administration stepped in. Hospital President Dr. Melinda Estes says the administration’s help was instrumental in resolving the dispute.

(Estes) Well, the governor wasn’t personally involved in the negotiations. However, he certainly met with me on two separate occasions and met with the representatives at Cigna and indicated to us how important this negotiation was for not only the Cigna members in Vermont but also for the citizens of Vermont, and we took him seriously.

(Dillon) The new contract covers two years. The contract terms are confidential, but Dr. Estes says the insurance company did agree to increase its reimbursement rates to the hospital.

(Estes) You know, negotiation is all about compromise. And I think we both compromised, and so Cigna made some substantial movement in what they had put on the table and we did likewise.

(Dillon) A Cigna spokeswoman also praised the governor’s role in the talks. The spokeswoman said that the contract negotiation was a balance between the hospital’s need for more money, versus the insurance company’s push to hold down health care costs.

For Vermont Public Radio, I’m John Dillon in Montpelier.

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