North Mississippi Health Services Ends Medicare Advantage Contract with United Healthcare

North Mississippi Health Services (NMHS), a major health system in Tupelo, Mississippi, has ended its contract with United Healthcare for Medicare Advantage plans as of June 1. This decision follows over a year of negotiations between the two entities. NMHS operates eight hospitals and more than 70 clinics across a 24-county service area, serving approximately 17,000 United Healthcare Medicare Advantage enrollees, most of whom are elderly patients. Other United Healthcare plan types, including commercial, Medicaid, Marketplace, and CHIP, remain in-network with NMHS.

The primary factor driving the contract termination was persistent delays and denials of inpatient Medicare Advantage claims. NMHS reported a significant increase in initial claim denials, from 17% in February 2024 to 42% in April 2024 at its North Mississippi Medical Center-Tupelo, which is the region's only Level II trauma center. Although approximately 85% of denials were eventually overturned, the high denial rate and lack of clear explanations from United Healthcare were cited as core issues.

United Healthcare offered to extend the contract to continue negotiations and proposed alternative solutions to maintain network inclusion; however, NMHS declined these offers. United Healthcare emphasized patient care continuity, offering out-of-network benefits to members with retiree Medicare Advantage plans and transitional care for those in the midst of complex treatments.

This network change affects patients enrolled in Medicaid-required Dual Special Needs Medicare Advantage plans, an important consideration given that 44% of Medicare beneficiaries in Mississippi participate in Medicare Advantage programs. NMHS has advised patients to consult with Medicare about potential enrollment changes, including utilizing special enrollment periods outside the standard October-December window.

The development underscores ongoing challenges in payer-provider relationships within Medicare Advantage, especially regarding claim management and reimbursement processes. It highlights the operational and financial pressures on regional health systems working with large insurers. These contract disputes have implications for patient access to in-network care, provider revenue cycles, and administrative burdens associated with claims processing within Medicare Advantage frameworks.