Apex Healthcare, Inc. Terminates Tufts Health Plan's Contract; Health Plan Seeks Independent Relationships With Providers in the Seacoast Area.

BEDFORD, N.H.--(BW HealthWire)--May 14, 1999--

Apex Healthcare, Inc. ("Apex") has decided to terminate its contract with Tufts Health Plan, effective June 30, 1999. The action follows months of negotiations in which the parties could not come to an agreement. In a related move, Apex released their individual providers to contract directly with Tufts Health Plan.

Apex PHO currently represents 72 primary care physicians (PCPs), area specialists and Exeter and Portsmouth Hospitals. Tufts Health Plan provides health coverage to 16,000 members seeking services through these providers. There are several managed care plans in the state currently contracting directly with these physicians and hospitals.

In anticipation of this contract termination, Tufts Health Plan had stopped referring members to Apex PCPs to decrease the potential number of members who would have to switch PCPs if an agreement could not be reached. The health plan is now actively pursuing contracts directly with these physicians and hospitals who had previously used Apex as their contracting agent with Tufts Health Plan.

"We made a reasonable and fair offer to Apex. We did not feel that we could absorb the kind of rate increases demanded by Apex, especially since Apex has financially performed well under our existing contractual arrangement," said Lisa Swenson, Vice President and General Manager of Tufts Health Plan's New Hampshire Operations

The health plan, which is in the process of communicating with and educating affected members regarding their options, expects to complete the direct contracting process by July. Its goal is to retain the Apex affiliated physicians and hospitals in its network, minimizing the need for its members to transfer to other physicians. In addition, the health plan has 1,600 other PCPs and specialists across the state who are part of its network.

"Our primary concern is for our members and we are doing everything we can to minimize disruption," said Swenson.

The 12th largest HMO in the country, with over one million members throughout the region, Tufts Health Plan is New Hampshire's third largest health plan with over 100,000 residents. Its network includes 14 New Hampshire hospitals and more than 1,600 physicians. The plan has received high marks for its quality from a variety of sources, including CareData Reports, U.S. News and World Report, American Health for Women and Newsweek, among others.