UMC’s contracts with Sierra Health to be terminated

By Emily Richmond

Wednesday, Oct. 17, 2001 | 9:07 a.m.

The County Commission, acting as the University Medical Center board, voted Tuesday to terminate contracts with Sierra Health Services next year, a move the public hospital's chief executive said is part of ongoing negotiations with the managed care company.

Last year, UMC cared for nearly 77,000 Sierra Health patients in its emergency room, urgent care clinics, primary care physicians' offices, inpatient and outpatient services and surgery, according to figures provided by the hospital.

"We've been good partners for years, but sometimes partners have to go their separate ways," said William Hale, UMC's chief executive.

Faced with rising costs, hospital officials need more money from Sierra Health to treat clients of the managed care company, Hale said.

Under terms of the contract, UMC is required to give Sierra Health one year's notice before terminating the deal.

Sierra Health officials said they didn't know the matter was on the board's agenda until the Sun called for comment on UMC's move.

"They certainly have the right to terminate the contract," said Jenny DesVaux Oakes, assistant vice president for Sierra Health's public and community relations. "But we've had a really positive relationship with UMC in the past, and we hope to continue to have one. We're negotiating in good faith."

Sierra Health estimates it will have paid UMC nearly $34 million by the end of 2001, Oakes said. The existing contract, which runs through 2004, called for a 4 percent increase in reimbursements next year, Oakes said. During the current negotiations, UMC officials have asked for rate increases of up to 40 percent over the current fees, Oakes said.

"We understand UMC's desire to better its economic position, but their contracted rate is already higher than our rates with other hospitals, including Sunrise and Lake Mead," Oakes said.

Dr. Anthony Marlon, former chief of cardiology at UMC, founded Health Plan of Nevada in 1982. He founded Sierra Health two years later.