There was a time when a hospital contract renewal was one of the more boring events in healthcare. Health systems and payers would work through rate disputes in private, and patients rarely knew the process was happening, let alone that their access to in-network care hung in the balance.
For the majority of contracts, that is still the case because both sides ultimately want to reach a deal. But a growing number of these negotiations are going public, complete with open letters, patient mailers, dedicated websites, local news coverage, public relations consultants and, in some cases, state legislative hearings.
What is less clear is the full scale of the problem. According to data from FTI Consulting, a total of 171 payer-provider disputes were reported in traditional media in 2025, continuing a clear upward trend from 127 in 2024, 86 in 2023 and 51 in 2022. The fourth quarter consistently records the highest number of disputes, reflecting the timing of contract termination dates that coincide with the calendar year. The fourth quarter of 2025 marked the highest number of disputes in any quarter since FTI began collecting data in 2022, with 76 reported disputes. Of those, 42 involved Medicare Advantage plans, and 22 resulted in contract terminations.
But FTI’s data only captures what makes it into the media. No government agency, insurer, health system or lawmaker is tracking the full scope of these disputes in real time. And the definition of “out-of-network” itself is complicated: a dispute can affect some lines of business but not others, some employer-sponsored plans but not their neighbors, and some facilities immediately and others months later.
Becker’s spoke with senior executives on both sides of the table, some actively battling each other, to understand how hospital and insurance leaders are calculating the risk of going out-of-network, what factors tip the scales and what, if anything, brings both sides back.
The self-insured shift
On the insurer side, executives point to what they describe as unprecedented rate demands from health systems as the primary driver of these disputes. April Barber, vice president of contracting and network operations at Regence, which operates Blue Cross Blue Shield affiliates in four states covering 3.6 million people, said her organization has fielded rate increase requests that would have been unthinkable a decade ago.
“We’ve seen within our four states, upwards of 90% over three years,” Ms. Barber said. “You can only imagine what that does to premiums and cost shares for our members and employer groups. It’s not something that’s sustainable or something that we could ever agree to. So even in an instance where [the provider] is a large entity, respected, and patients use them, we still can’t agree to a trend like that.”
Catherine Gaffigan, MD, president of health solutions at Elevance Health, who oversees provider contracting that covers a total of 46 million members, pushed back on the often-floated narrative that insurers are squeezing providers to pad their own profits. About 80% of Elevance’s commercial business is self-insured, meaning the employers, not the insurer, pay the claims directly.
“If 80% of my book is actually self-insured, I don’t make any money off of that,” Dr. Gaffigan said. “That is because our self-insured clients pay those bills. We do not, and we are not at risk for those bills. But we do have our fiduciary responsibility to hold a line and provide appropriate rate increases to our providers.”
According to KFF’s 2025 Employer Health Benefits Survey, the percentage of covered workers enrolled in self-funded plans has risen from 49% in 2000 to 67% in 2025, with the figure reaching 80% at firms with 200 or more employees.
Price transparency adds new fuel
One factor both sides identified as increasingly shaping their negotiations are federal price transparency requirements.
The rules, first implemented in 2021 under President Trump’s first term and progressively strengthened since, require hospitals to publicly post their payer-specific negotiated rates. A companion rule effective in 2022 imposes similar requirements on insurers. A February 2025 executive order directed agencies to escalate enforcement further, requiring “actual prices, not estimates.”
“We have negotiations happening right now, and have been happening this year, where entities have gone out-of-network because they were holding out for rates that they said they saw other providers being paid, either in their market or in other markets,” Dr. Gaffigan said.
She argued that raw rate comparisons strip away important context: quality performance, data-sharing agreements, value-based arrangements and other factors that influence what a given provider is paid but that don’t show up in public rates.
Perhaps unsurprisingly, health systems see it differently. Erik Wexler, CEO of Providence, said price transparency has given health systems the evidence they need to demand fair treatment.
“Now, with price transparency, we’re able to demonstrate when a payer significantly under-reimburses, and we use that data to help negotiate a fair rate of pay,” Mr. Wexler said.
So when is a network split impossible to avoid?
When a health system issues a termination notice, insurers face a calculation of their own: Is this a system they can afford to lose from their network?
“One of the key components is any regulatory requirements we have in regards to access,” Ms. Barber said. “That’s probably the No. 1 piece. Beyond that, it has to do with the capacity of alternatives in any given geography. Are they the only place? Is there somebody else nearby that can offer the same level of services?”
On the provider side, the calculus is no less complex. Brent Estes, senior vice president and chief managed care officer at New York City-based Mount Sinai Health System, is currently on the other side of that equation from Elevance. Mount Sinai physicians went out of Anthem’s network at the start of 2025, and the system’s remaining facilities are set to follow in March.
Mr. Estes described a rigorous internal process that begins long before any termination date. Mount Sinai built what he called a “whole financial disruption model” to predict the financial impact of going out-of network-across different timelines. The system’s board and finance committee were also involved.
“We were very clear with them at the outset, before we ever sent anything into Anthem for consideration, about what the issues were and what we needed to accomplish in a renegotiation of the contract,” Mr. Estes said. “We wanted to make sure we had governance buy-in at the board level before we started down any particular path.”
A critical piece of negotiations for the provider is whether the market can absorb what can be tens-of-thousands of displaced patients in the event of a split. Mount Sinai sees 200,000 commercial patients from Anthem annually.
“We’re not really sure the market has the capability of absorbing all the patients that would be seeking care elsewhere,” Mr. Estes said.
What brings everyone back to the table?
On the insurer side, executives described a process of sustained engagement rather than a single triggering event. Dr. Gaffigan said Elevance’s approach is to keep lines of communication open and continue returning to the table, sometimes bringing in more senior leaders when negotiations stall. She said the company also works closely with employers directly during contentious talks, keeping them informed so they understand what’s at stake.
“They’re the ones that end up paying these bills,” she said. “I think they appreciate the way that we’ve worked with them, and sometimes they will, in fact, advocate for us on our behalf.”
At Mount Sinai, Mr. Estes said insurers ultimately return to the table when the competitive consequences become unavoidable.
“The payer usually ultimately realizes that they’re better off getting to a deal than not, especially with a health system like ours that is going to continue to be less expensive than other options in the marketplace,” he said. “Without Mount Sinai, their network looks completely different from the networks of the other plans. They will ultimately have client retention problems and growth issues in the marketplace without a competitive network.”
In most cases, the pressure resolves the dispute before patients are affected. Regence and Coeur d’Alene, Idaho-based Kootenai Health reached an agreement with less than a week to spare before the end of 2025, after a public out-of-network announcement had been made. Ms. Barber described Regence’s general approach to reaching resolution as moving past broad rate demands and getting specific about the service categories where a system needs the most investment, rather than applying what she called a “peanut butter spread” of uniform increases.
In other cases, the standoff persists. Baltimore-based Johns Hopkins Medicine ended negotiations with UnitedHealthcare without a new deal in September. Johns Hopkins said UnitedHealthcare was demanding overly burdensome prior authorization requirements. The payer said the system wanted to be able to exclude certain employer-sponsored plans.
At Providence, Mr. Wexler framed the broader environment as a “polycrisis” for health systems: rising labor costs, supply inflation, and deteriorating government reimbursement, all converging at once.
“Sometimes these things defy all business logic, which is kind of the way I feel about our situation,” Mr. Estes said. “It takes two to tango. We’re sitting here waiting and hoping that they reengage, but time is short.”
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