Seattle Children’s Hospital Treats 125 Patients in January Who Lost Contracted Access Through Washington’s Health Benefit Exchange

Ailments range from craniofacial disorders to a neck mass; cost of treatments denied by non-contracted Exchange plans have been absorbed by the hospital


Seattle Children’s Hospital announced today that it has treated approximately 125 patients who lost contracted access to Seattle Children’s when new plans on Washington’s Health Benefit Exchange became effective at the beginning of the year.

Those patients, whose ailments range from craniofacial disorders to a neck mass, were all treated by Seattle Children’s regardless of their Exchange plan coverage, but continued access to the hospital remains in question.

“This is a dire situation for our patients,” said Dr. Sandy Melzer, senior vice president and Chief Strategy Officer, Seattle Children’s. “We can’t continue providing services to these patients without reimbursement from their insurance companies. Eventually, these patients will have to seek care elsewhere, and for the treatment of many conditions, there is nowhere else to go in the region.”

Seattle Children’s has filed exception requests on behalf of the 125 patients. Of the more than 200 exception requests, approximately 20 have been answered by insurance companies. Eight of those were denials, including:

  • A 2-year-old with a neck mass that could have been a dangerous infection or a tumor;
  • A teenager suffering from mitochondrial disease, a rare disorder that requires treatment from a variety of specialists;
  • A 5-month-old baby diagnosed with craniosynostosis , a very serious condition in which the seams of a baby’s skull fuse together prematurely, leaving no room for the growing brain. Seattle Children’s performs more craniosynostosis surgeries than any other center in the country, based on national hospital discharge data.

Seattle Children’s made a decision to treat the patients - even though the plans will not pay network benefits for this care - to give families time to work with insurance providers and better understand their new benefits. To date, the hospital also has incurred tens of thousands of dollars in administrative costs associated with the extra work required.

But Dr. Melzer said the real concern is the potential lack of coordinated care. Kids like the teenager with mitochondrial disease will be forced to see a variety of doctors in various areas of Seattle and Washington. Studies have shown that such fragmenting of health care services can negatively impact outcomes and increase cost.

“The primary care physicians who refer these kids to us do so for a reason,” Dr. Melzer added. “Even if a small number of children experience care that is delayed or discontinued, or are first sent to a hospital that can’t handle their problem, then that’s too many.”

The problem with Washington’s Health Benefit Exchange began last year, when many of the approved plans did not include Seattle Children’s as a provider, leaving many patients without coverage for some of the most specialized pediatric medical care in the Pacific Northwest.

In October, Seattle Children’s filed suit via the Superior Court of Washington for King County against the Office of the Insurance Commissioner (OIC), citing the failure of the OIC to ensure adequate network coverage in several Exchange plans. The lawsuit remains in the preliminary procedural stage.

The hospital also filed an administrative appeal asking the OIC to reverse its decision to approve Exchange plans from Coordinated Care Corporation, Premera Blue Cross and Bridgespan Health Company. (The hospital initially challenged Molina Healthcare of Washington but has since reached an agreement). The administrative appeal is also in process.

“We filed the lawsuit and the appeal on behalf of our patients,” said Dr. Melzer. “Every child deserves access to the best medical care. We need to ensure that the kids and their parents in our region have access to the health services they need, when they need them.”

When the lawsuit and the appeal were filed, Seattle Children’s didn’t know how many patients might be affected by the new system. The hospital also didn’t know how patient families would react, or if they would understand their new plans.

“We got our answer fairly quickly,” said Dr. Melzer. “Families were confused about their new benefits. Many didn’t know that Seattle Children’s is no longer included in their network.”

About Seattle Children’s

Seattle Children’s Hospital, Foundation and Research Institute together deliver superior patient care, advance new discoveries and treatments through pediatric research, and raise funds to create better futures for patients. Consistently ranked as one of the top 10 children’s hospitals in the country by U.S. News & World Report, Seattle Children’s Hospital specializes in meeting the unique physical, emotional and developmental needs of children from infancy through young adulthood. Through the collaboration of physicians in nearly 60 pediatric subspecialties, Seattle Children’s Hospital provides inpatient, outpatient, diagnostic, surgical, rehabilitative, behavioral, and emergency and outreach services to families from around the world.

Located in downtown Seattle’s biotech corridor, Seattle Children’s Research Institute is pushing the boundaries of medical research to find cures for pediatric diseases and improve outcomes for children all over the world. Internationally recognized investigators and staff at the research institute are advancing new discoveries in cancer, genetics, immunology, pathology, infectious disease, injury prevention, bioethics and much more.

Seattle Children’s Hospital and Research Foundation and Seattle Children’s Hospital Guild Association work together to gather community support and raise funds for uncompensated care, clinical care and research. The foundation receives nearly 80,000 gifts each year, from lemonade stand proceeds to corporate sponsorships. Seattle Children’s Hospital Guild Association is the largest all-volunteer fundraising network for any hospital in the country, serving as the umbrella organization for 450 groups of people who turn an activity they love into a fundraiser. Support from the foundation and guild association makes it possible for Seattle Children’s care and research teams to improve the health and well-being of all kids.

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