Health care crisis line (computer problems) : LUSENET : TimeBomb 2000 (Y2000) : One Thread

TO: 1.11.2000 07:03:33 Harvard Pilgrim Health Care of New England went out of business Dec. 31, but the financial crisis continues for many doctors and other health-care providers to whom the insurer owes money.

I am a practicing podiatrist in East Providence. I was told on numerous occasions . . . that claims dated after Oct. 25 would be reimbursed at normal Harvard Pilgrim standards. Since then, I have received calls from other providers [about] claims as late as Nov. 14th, with complete denial of payment . . . This is against everything that I have been told.

-- D.D., Barrington

It's a big mess, and it's not clear how soon it'll be resolved.

Rhode Island insurance regulators seized control of Rhode Island's Harvard Pilgrim Oct. 25. At the time, the regulators said that you and other health-care providers would have to file claims under a court proceeding to see how much you could recover for amounts you were owed before Oct. 25. (Regulators won't know how much money will be available to pay these debts until after the company is liquidated.)

What about payment for care you provided Rhode Island Harvard Pilgrim patients after Oct. 25? Regulators said you'd be paid in full in the normal course of business.

The problem is that the payments for these post-Oct. 25 services are being handled by the insurer's affiliate, Harvard Pilgrim of Massachusetts, which is having its own financial problems, compounded by a mixed-up computer system.

As a result, you and many other health-care providers are frustrated: you haven't been paid for services you rendered before Oct. 25, but you also have received little -- if anything -- for services you rendered after Oct. 25.

Creditors expressed their frustration over this point when they met late last month with Rhode Island Insurance Commissioner Tom Schumpert.

``They tell us the check's in the mail,'' but checks haven't been arriving, said John Vernancio, chief executive officer of New England Ambulance Service of North Providence.

Vernancio said Rhode Island's Harvard Pilgrim accounted for about 30 percent of his company's business, and owes his firm more than $100,000.

``I don't think the [Rhode Island Department of Business Regulation] understands the severity of the problem . . . It's forcing companies to use lines of credit just to meet payroll,'' he said.

Creditors also disclosed a new twist in the saga. After waiting for weeks to be paid, some creditors recently received a mailing from the Massachusetts Harvard Pilgrim saying they would be paid nothing, at least not immediately.

The reason? Some creditors wound up being accidentally paid in November or December for services they rendered before Oct. 25. As a result, the computer system that's run by the Massachusetts Harvard Pilgrim is subtracting these payments from the amount that health-care providers should be collecting right about now, for services rendered after Oct. 25.

Shortly after Christmas, the Massachusetts Harvard Pilgrim mailed out about 350 checks totaling about $215,000 to doctors and other providers who are owed money for services rendered after Oct. 25, Schumpert said.

However, many other creditors -- perhaps as many as 1,200 -- simply received statements or invoices saying that their current payments were being reduced -- or even eliminated -- because of prior payments they mistakenly received for pre-Oct. 25 debts, Schumpert acknowledged.

Schumpert said he understands the creditors' problems. However, he said he has no alternative but to rely on the troubled accounting system that the Massachusetts Harvard Pilgrim maintains. It's a system he inherited when he took control of Rhode Island's Harvard Pilgrim, and which he cannot untangle. ``It adds to my frustration that I don't have the ability to resolve an ongoing computer and accounting problem.''

The latest twist came last week, when Massachusetts regulators seized control of the Massachusetts Harvard Pilgrim. Massachusetts regulators have not said how this will affect future payments to Rhode Island creditors for money they're owed by the Rhode Island Harvard Pilgrim.

Massachusetts regulators have allowed at least one payment to be distributed to Rhode Island Harvard Pilgrim creditors, Schumpert said on Friday.

However, the takeover ``could delay future payments to Rhode Island providers if Massachusetts regulators decide to freeze'' such distributions, he said. Schumpert said he is to meet soon with Massachusetts regulators to try to iron out the problems.

I went in for a scheduled visit to the Harvard building over by the Warwick Mall on Dec. 22nd . . . and I walked up to the desk to check in. I took my $10 out for my co-pay and tried to give it to the girl, and she said, `Oh no, we're not collecting money any more.' And I said, `Well, then, what do you want? A check or a credit card or something?' And she said, `No, we're not taking [payments] and co-pays any more . . . ' I found that kind of strange. And then my wife went to her primary care physician . . . and he informed her he hasn't been paid for any Harvard bills he's submitted since early October. Now, how could a company who's on the verge of bankruptcy not be even collecting the $10 co-pays?

-- S.N., Warwick

``We never once authorized the discontinuance of [payments] due us'' since taking over Rhode Island's Harvard Pilgrim, Schumpert said. Your situation ``sounds to me as if an individual employee elected, for whatever reason, not to collect the co-pay.''

Yours may not be an isolated event, however. Schumpert acknowledged that he heard of another instance in which a pharmacy worker did not collect a payment owed for a prescription.

Schumpert stressed that such employees were not following policy. ``We have tried to collect every cent we could,'' he said.

TODAY'S TIP: The next briefing for creditors of Rhode Island's Harvard Pilgrim is to be held at 9:30 a.m. tomorrow at the state Department of Business Regulation, 233 Richmond St., Providence.

-- Homer Beanfang (, January 11, 2000


This sounds a lot like the circumstances reported by Cory Hamasaki about Oxford Healthcare's crash due to computer problems. Hmmm...

This bears further watching.


-- Wildweasel (, January 11, 2000.

Unfortunately Harvard Pilgrim of New England is the parent company for Harvard Pilgrim of Rhode Island, New Hampshire, and Maine. When the parent company went into receivership so did all the associated groups except Rhode Island went down first. There probably isn't enough money to pay everyone who needs to be paid, and it also looks like there will be a big financial rats nest to unravel although I understand that in order to keep their provider network as much as possible they hope to pay providers who submit claims since January 1, 2000 first. Of course this means that they will pay providers prior to that time second, meaning some have to wait longer for their money. I assume the reason for paying some earlier is to "keep the network alive" meaning that some other insurance company might view that as a positive and be willing to pay something for it. In the meantime consumers are having a tough time because Tufts is also leaving the State of Maine, as rapidly as possible, and this fact has not been lost on those who do offer insurance. Very expensive. I once read that Americans really want very good health care, and that we spend a good bit more on it thn other nations. Our insurance premiums are high, cost of drugs has skyrocketed, and doctors aren't cheap either. Then too every test has gotten more complicated and equipment is very expensive. The staff at Harvard Pilgrim must be burning a lot of midnight oil to try to sort out this mess. apparently disparate computer systems which couldn't compare similar financial entities made for a lot of cofusion. the head of Harvard Pilgrim stated that when he came into office there were something like 23 different ways that a provider could be paid and he couldn't believe it. Glad I am not in their shoes. Charlie

-- Charlie (, January 12, 2000.

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