The Lawrence Memorial Hospital at 325 Maine St. in Lawrence. The system announced this month it would no longer accept Medicare Advantage Plans from Aetna and Humana starting next year. Although the system said continuing to accept the plans would not be sustainable for its finances, it has left about 4,000 people in need of finding new insurance plans.

Pat and Ned Kehde had two decades of stability when it came to figuring out their health care.

The two Lawrence residents signed up for a Medicare Advantage plan with the health care giant Aetna after retiring, and continued with that plan year after year. Ned said it was cheaper compared to other options they looked at, and it covered all the doctor’s appointments that he and his wife needed.

But that stability abruptly changed when LMH Health announced that starting in the new year, it would no longer accept Medicare Advantage plans from Humana and Aetna, citing problems with reimbursement rates from the companies and coverage issues for patients.

While other hospitals and medical groups across the country have made a similar move because of ongoing frustrations with Medicare Advantage plans, the Kehdes are two of the roughly 4,000 patients at LMH whose insurance plans will no longer be accepted there in-network. And they’re caught in the middle, needing to navigate a complicated process of finding a different health insurance plan.

“We’re in limbo right now,” Ned said. “It’s a confusing mess.”

Many Americans who are eligible for Medicare have chosen the Medicare Advantage plans — private-sector alternatives first introduced by Congress in 2003 — over traditional Medicare. Currently, 31 million Americans are enrolled in one of those plans offered by large insurance companies.

But since the plans have been introduced, hospitals and medical groups have found insurance companies have been reimbursing less money back to the hospitals. Although Medicare Advantage plans are supposed to base their reimbursements on Medicare’s rules, private companies can create their own clinical standards of whether to authorize or pay for care. A national study found that in 2019, Medicare Advantage plans denied authorization for 13% of claims for treatment and denied payment for 18% of claims that met those rules.

Those conditions are what has led LMH to not accept the Medicare Advantage plans offered by Aetna and Humana, Rob Chestnut, the chief financial officer for the hospital, told the Journal-World.

Chestnut said reimbursement payments the hospital received from the Aetna and Humana Medicare Advantage plans were lower than not just traditional Medicare rates but the rates of Medicare Advantage plans from other companies.

Chestnut did not provide exact numbers on how LMH is being affected financially, citing the fact that the hospital has nondisclosure agreements for other contracts for what insurance it accepts, but he did say that the difference in payments was “substantial” to the hospital. He said that nationally, Medicare Advantage plans reimburse hospital groups around 8% to 12% lower than what traditional Medicare plans do.

Those gaps have led some hospital systems and medical groups to not accept any Medicare Advantage plans, and Chestnut said the financial issue is a big reason why LMH is making its changes.

“It’s not sustainable for us going forward,” Chestnut said.

Another issue Chestnut cited was increased delay of prior authorization from the companies to provide care for patients. Chestnut said there were times when a patient came into the hospital for inpatient care toward the end of a week and some types of care were held off “four to five days” just to get the treatment authorized.

“These patients are sick and need to focus on recovery, not if their insurance is going to cover them,” Chestnut said.

Chestnut also said the hospital has faced issues getting patients with Medicare Advantage plans into long-term care because of a tendency from companies to delay or deny coverage for more expensive treatments.

The Journal-World attempted to contact Humana and Aetna for comment. Aetna representatives gave the Journal-World a specific number to call for media. When the Journal-World called it, the line said it was no longer taking calls and the voicemail box was full. Humana representatives, meanwhile, said there was not a line for questions.

The hospital will still accept other Medicare Advantage insurance plans, including Healthy Blue and those from United Healthcare. Additionally, all other plans from Humana and Aetna that aren’t Medicare Advantage plans will still be accepted at the hospital, Chestnut said.

Mimi Meredith, the director of communications, marketing and community engagement at LMH, said the hospital would also accept supplemental Medicare plans offered by Humana and Aetna in the new year.

Chestnut acknowledged that dropping the Humana and Aetna Medicare Advantage plans was disruptive to patients and was a tough choice for the hospital to make. However, he said LMH made the change ahead of the open enrollment period, which starts in October, and has been notifying all of its patients who would be impacted.

But now patients like the Kehdes are left stranded in a sea of different, confusing plans and an alphabet of Medicare options that can feel incomprehensible.

“It’s a complex thing to talk about,” Ned Kehde said.

Megan Poindexter, the executive director for the Senior Resource Center for Douglas County, said her team is there to help people navigate their Medicare questions. Poindexter said the center has volunteer Medicare counselors who are trained by the state’s Senior Health Insurance Counseling for Kansas program to specifically help seniors find the best Medicare coverage for them.

Poindexter said that unlike Medicare Advantage plan salespeople who receive a commission for signing people up to those plans, SHICK counselors do not sell anything and don’t get a commission. Their role is just to look through the plans to find the best plan for the consumer.

“This is what we do every year,” Poindexter said.

Poindexter noted that Medicare plans can change every year and said everyone should review their plans, but she said people whose coverage plans were dropped by LMH have reached out to the senior center. Once Oct. 1 comes around, Poindexter said people can call to get appointments to meet with a health care counselor. Those appointments will go from Oct. 15 to Dec. 7 — the same time of the open enrollment period for Americans to choose a Medicare plan.

The Kehdes count themselves in a fortunate position and feel they’ll be able to figure something out. But they’re still disappointed that this dispute between the insurance companies and the local hospital is affecting thousands of people like them, through no fault of their own.

“I understand how that works, but the people who end up being cast out into the wilderness are the consumers,” Pat Kehde said.