Temple Health warns patients of possible termination with Keystone First health insurance plans

Temple Health’s current contract with Keystone First, a large Medicaid insurance provider in southeast Pennsylvania, expires on July 31.

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Chestnut Hill Hospital

Chestnut Hill Hospital became part the of Temple University Health System in January of 2023. (Kimberly Paynter/WHYY)

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Temple Health and Keystone First, one of the largest Medicaid health insurance plans in the region, are at odds over a new contract agreement, with a looming July 31 deadline.

If the two parties don’t reach a new deal in the next three weeks, potentially thousands of patients may need to choose between their health care provider and their insurance plan.

Temple Health is warning people with Keystone First health insurance that they may lose in-network covered services for medical care, testing and treatment beginning Aug. 1.

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“Fortunately for our patients, our providers are in-network for a number of other plans and we will be focused on ensuring a smooth transition of care for the patients and families impacted,” Temple Health officials said in a statement.

More than 263,000 people in Philadelphia have Keystone First insurance as of May, according to state reports. Any changes to covered services won’t happen before Aug. 1.

Officials for Temple Health and AmeriHealth Caritas, the parent company for Keystone First, confirmed that they are still engaged in contract negotiations.

In a written statement, Temple Health said the health system has incurred “tremendous increases in supply costs, labor costs and drug prices” in recent years, including during the COVID-19 pandemic.

Because of that, health officials say they want AmeriHealth Caritas and Keystone First to reimburse at higher rates and match the growing costs.

A spokesperson for AmeriHealth Caritas said higher payment rates are already on the table.

“Although we believe the system is paid fairly for the services it provides our members, in support of our good faith negotiations, we proposed a rate increase in the new contract,” officials said in a statement.

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However, Temple Health has not accepted these proposals as “fair and sustainable” options.

“The significantly higher costs of providing the high-quality services and care that our patients and community expect and deserve has made it infeasible to operate under the old models,” Temple Health officials said.

AmeriHealth Caritas officials said they hope to come to an agreement with the health system by the end of the month in order to avoid an upheaval for patients and their families. In a statement, they added that, “it is unfortunate Temple has chosen to escalate our negotiations in this way.”

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