Down East Community Hospital in Machias, left, and Calais Regional Hospital. Credit: File

A Tennessee company that has fought ongoing national efforts to eliminate some large, surprise medical bills will soon become the employer of ER doctors in Washington County’s two small hospitals.

In March, Envision Physician Services will take over the staffing of the emergency departments at Calais Regional Hospital and Down East Community Hospital in Machias. It will replace a much smaller Maine-based company, BlueWater Health, that has provided the ER doctors to those hospitals in recent years.

Both hospitals said that the new contract with Envision will save them hundreds of thousands of dollars a year. Cutting costs is a particular priority for Calais Regional Hospital, which recently declared Chapter 11 bankruptcy after losing money every year since 2011. The leaders of both hospitals have also been unable to negotiate new contracts with the unions representing their nurses.

For now, Envision said that it plans to maintain a similar level of staffing as BlueWater has at those hospitals. Like BlueWater, it will keep at least one doctor in each of the emergency departments at all hours, seven days a week. BlueWater has also provided a second worker, usually a physician assistant or nurse practitioner, to staff the ERs at night. Envision spokeswoman Aliese Polk said the company will provide additional staff if needed.

Both hospitals paid roughly $2.5 million to BlueWater for its services in 2017, according to their most recently available tax filings. DeeDee Travis, vice president of community relations at Calais Regional Hospital, said the hospital will save about $900,000 a year by switching to Envision. Julie Hixson, marketing director at Down East Community Hospital, estimated that the Machias hospital would save several hundred thousand dollars with the switch.

Travis and Hixson both said that their hospitals have had a good relationship with BlueWater but that Envision will be able to offer strong care while reducing costs. Each hospital is entering a three-year contract with the company.

“It really came down to finding a better fit for the financial viability of the hospital, while maintaining the high bar we set for quality of care,” Calais Regional Hospital CEO Rod Boula said in a written statement.

The change will not significantly affect BlueWater, a small but growing company that provides physician staffing in Maine, Vermont and Massachusetts, according to Jay Mullen, an emergency medicine doctor who serves as its CEO. But Mullen did question whether a large national company will be able to recruit and retain physicians as well as his operation can in a rural place such as Washington County. He said that few of BlueWater’s providers are considering working for Envision when it takes over.

“It can be incredibly difficult to recruit and retain high-quality emergency physicians and advance practice providers in remote places like this,” Mullen said. “Large contract management groups like Envision have access to physicians that they’ll fly in from Texas or Ohio, but that’s not usually in the best interest of the community or hospital for that to be a long-term solution.”

Polk, the Envision spokesperson, said that the company “is dedicated to serving patients in rural America and recognizes that the clinicians who live and work in the area understand the unique needs of the community. We want to provide care alongside them and have offered employment to all the clinicians currently working at the hospitals.”

Envision’s parent company — which was acquired last year by the private equity company KKR in a $9.9 billion deal — has lobbied against recent efforts by Congress to eliminate the steep costs that can come from a practice known as surprise, out-of-network billing, according to The New York Times.

That happens when patients suffering a medical emergency go to a hospital that accepts their health insurance but see a doctor who is not part of their insurance network, resulting in a steep bill that their insurer may not agree to cover.

Recent research from Yale University has found that when Envision and one of its competitors entered hospital emergency rooms between 2011 and 2015, a greater share of patients who had insurance accepted by the hospitals ended up receiving those shocking out-of-network bills, which can cost hundreds or thousands of dollars out of a patient’s own pocket.

Polk did not directly respond to a question about whether patients in Washington County may receive out-of-network bills. “In an emergency, patients should not be forced to make financial decisions ahead of medical ones,” she said in a statement. “For patients, seeking the most appropriate care is the priority, and we are committed to working with insurance companies to provide patients with access to care when they need it most.”

But the company has previously said that it would work to have more of its doctors accept insurance, and a spokesperson recently said that 90 percent of its care is in-network, The New York Times reported in September.

The hospitals in Washington County said that they do not expect patients to receive out-of-network bills after seeing Envision providers if the hospitals generally accept their insurance.

At Calais Regional Hospital, the contract with Envision will require its providers to have credentials from all the insurance programs that the hospital already accepts, according to Travis.

Down East Community Hospital does not having anything in its contract that would specifically prevent Envision providers from staying outside the hospital’s insurance networks, but Hixson said that “this would not be an issue” because the Machias hospital will not outsource its coding or billing to Envision, as some hospitals do.

Envision already does provide some staffing at another Maine hospital in Chapter 11 bankruptcy, Penobscot Valley Hospital in Lincoln. That hospital’s CEO, Crystal Landry, did not respond to a request for comment.

Another physician staffing company that has opposed the federal effort to rein in surprise bills, TeamHealth, gained a foothold in Maine early this year when it began contracting with Northern Light Health to employ the emergency room and hospitalist doctors at the system’s hospitals in Blue Hill, Ellsworth, Pittsfield and Waterville. It more recently took over the emergency department staffing at Northern Light A.R. Gould Hospital in Presque Isle.

A Northern Light spokeswoman, Suzanne Spruce, said “there have been no issues” with patients receiving out-of-network bills since the contract with TeamHealth began. She also said that the contract prevents TeamHealth from “balance billing,” a term that refers to when a provider bills patients for any additional amount that an insurer won’t cover.