Hospital employees paying much more out-of-pocket with Novant health insurance plan

Now the year is up since the hospital sold, some employees are experiencing health insurance sticker shock
Published: Mar. 2, 2022 at 11:09 AM EST
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WILMINGTON, N.C. (WECT) - It was one of many concerns voiced by employees before New Hanover County sold the hospital to Novant Health: losing their great benefits package. For a year after the hospital sale closed in February 2021, employees say they were able to keep the same health insurance plan they had through New Hanover Regional Medical Center (NHRMC). That year is now up, and some employees are already experiencing sticker shock.

“We were told we had one more year with the NHRMC benefits, but that the Novant package would be comparable. So then, kind of getting close to the end of the year at open enrollment, they broke down the plans and said their standard plan was the most comparable to what we had with NHRMC. And then, so I took it a step further and paid for their premium plan, thinking that would give me even better than what I had, because we use [our health insurance] a lot,” one hospital employee told WECT, speaking on the condition of anonymity for fear of publicly questioning her employers’ recently revised benefits plan.

In addition to paying significantly higher premiums than she was under NHRMC’s previous health insurance plan, this employee said many of her doctors are not in-network with Novant’s health insurance carrier, Cigna. She is reluctant to change providers because her doctors have treated her for some significant health issues in the past and are familiar with her medical history. But continuing to see doctors that Cigna designated as Tier 2 providers means she has to pay 100% of her medical bills out of pocket until she’s met her family’s $3,800 deductible.

“It wasn’t until January when we got our first specialist bill afterwards. And I was shocked. And then I started looking further into it... I started looking at the rest of my providers, and they had sent us a list and I compared to the list we had, and none of my doctors are on this list [of Tier 1 providers],” the employee explained.

Adding to her frustration, there is no Tier 1 provider at all in Wilmington for several specialties her family uses.

“When I say dermatology wasn’t on there - there’s one dermatologist in Myrtle Beach. And that’s the only one. They call us the coastal market. There’s like one specialist in Clayton, North Carolina, which isn’t exactly convenient to travel to. So what’s included in the coastal market? I don’t know exactly where they draw the boundaries, but it’s not all Wilmington or Leland or extremely close and convenient,” she explained.

A list of Tier 1 providers shared with WECT does not show any Wilmington radiologists, anesthesiologists, ear, nose and throat physicians, or allergists, for example. There are only three Wilmington pediatricians on the Tier 1 provider list, for an organization that employs more than 7,000 people. A number of employees have contacted WECT to express their frustration. When asked about the concerns, a spokesperson for Novant Health provided the following written statement:

“Novant Health team members have the opportunity to choose from several different insurance providers and plans for health coverage. One of these insurance options offers a plan with no deductible or coinsurance. The other plans do have a deductible and/or coinsurance, and utilize a tier system to help reduce these out-of-pocket costs. Team members who see a Novant Health or independent Tier 1 provider will see greater out-of-pocket savings. We are actively working to increase the number of providers classified Tier 1 by the insurance company. We are also working to ensure team members understand the benefits available to them through this transition by providing support and resources, including the growing list of Tier 1 providers in the Coastal region.”

The employee tells WECT that when open enrollment happens again, she plans to step down to a lower benefits package. While in theory, her premium plan would have saved her money because of her family’s higher-than-average health needs, in practice, it hasn’t worked out because of the limited provider network here. She suspects Novant employees in other parts of the state probably have more Tier 1 options than employees in the Wilmington market, which is somewhat unique because of its smaller size and limited competition.

“The doctors [here] do have the option to negotiate with Novant to become Tier 1 providers. But asking - at least the specialists I’m seeing here - they don’t want to because it’s a buy-in. And it’s since they don’t have competition or any reason to, it just isn’t worth it for the independent practices. So we’re just left with them staying Tier 2 providers,” the employee explained.

While many of them are outside of Wilmington, Novant Health tells WECT there are nearly 1,000 Tier 1 providers in the “coastal region.”

“Novant Health has maintained affordable coverage, as benefits costs have escalated nationwide. Over the past decade, family premiums for employer-sponsored coverage have jumped 47%, according to a report from the Kaiser Family Foundation. That rate outpaces both wage growth (31%) and inflation (23%) over the same time period,” a hospital spokesperson added. “As with any employer benefits transition, some providers who were in-network at the legacy organization may not be in the new network. There may also be providers who were not previously in-network that are now in-network through the new plan.”

While all of that may be true, employees say the changes are taking a financial toll on their families.

“I think that was the most shocking part, is that I work for the biggest employer, which is the hospital, and my coverage is a lot worse than a lot of friends of mine who work for smaller, private companies. It’s a little bit like a slap in the face, everything that everybody’s going through with COVID in the medical field, and then to take such a big step back with our benefits,” the hospital employee said of the situation.

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