Mental health services at risk in Minnesota contract dispute

Hundreds of children in Minnesota could soon have a harder time getting healthcare because of a contract dispute between a payer and a provider.

Prairie Care, a Brooklyn Park-based operator of mental health hospitals and clinics, announced that on Oct. 20 it will sever ties with Medica, a not-forprofit insurance company that serves about 1.5 million customers in Minnesota and surrounding states. Prairie Care claims the insurer restricts when children can get care.

Medica, however, claims that patients, on average, stay at Prairie Care facilities three days longer than at other hospitals and the cost to care for them is 150% higher. Prairie Care is asking for a rate increase in its next contract.

Medica’s behavioral healthcare network is maintained and managed by Optum, a consulting and technology services arm of insurance giant United-Health Group.

Prairie Care CEO Dr. Joel Oberstar was quoted in the announcement as saying that only 20% of the system’s patient population was covered by Medica, but its utilization-review staff spent 80% of its time fighting to get authorization for critical psychiatric care.

Medica spokesman Larry Bussey says Prairie Care’s patients are expensive to cover and that the health system is asking for rate increases of “200% to 300%.”