Mercy Health, Anthem reach agreement
Sep. 29—LIMA — Mercy Health and Anthem Blue Cross Blue Shield reached an agreement Friday to keep Anthem Medicare Advantage plans in network and bring Anthem-managed Medicaid plans back into the health system's network.
The agreement ends a months-long dispute between the two parties, during which Mercy Health terminated a contract with Anthem in July covering nearly 50,000 Ohioans enrolled in Anthem-managed Medicaid plans as the health system sought higher reimbursement rates for employer-sponsored and Affordable Care Act plans.
The health system threatened to terminate its Medicare Advantage contract with Anthem starting Oct. 1, but Friday's agreement keeps those plans in network and resumes coverage for Anthem-managed Medicaid plans.
Nearly 15,000 Ohioans are insured through Anthem Medicare Advantage plans.
The agreement calls for Anthem to cover any claims patients enrolled in its managed Medicaid plans received since Mercy Health went out of network July 1, while Mercy Health agreed to dismiss a lawsuit it filed against Anthem in Virginia, according to a press release about the contracts.
But other details from the agreement were not released "due to confidentiality provisions in the contract."
Payment disputes prompt mid-contract negotiations
Negotiations started in 2022, roughly two years before the contract between Anthem and Mercy Health would expire.
Mercy Health officials told reporters earlier this year that Anthem parent company Elevance Health owed $100 million in late and unpaid claims as of June, and that the health system had suffered "significant" losses due to rising labor costs and inflation. (An Anthem spokesperson disputed the $100 million figure, stating that 98% of claims processed in the last year were resolved within 30 days.)
The health system terminated part of its contract with Anthem in July, resulting in nearly 50,000 Ohioans enrolled in Anthem-managed Medicaid plans to go out of network, and threatened to stop accepting Anthem Medicare Advantage plans on Oct. 1 if the insurance company didn't renegotiate its contract.
Mercy Health took similar action in other states as it left Anthem's Virginia Medicare Advantage network in August and notified the insurance company of its intent to do the same in Kentucky.
The dispute revolved around reimbursement rates for commercial plans, prompting condemnation from Ohio Department of Medicaid Director Maureen Corcoran, who rejected a request from Mercy Health to authorize a special enrollment period and reassign Ohioans insured through Anthem-managed Medicaid to other plans.
"ODM will not use its members as an incentive to force a resolution to that commercial, non-Medicaid disagreement," Corcoran wrote in July.
The two parties reached an agreement days before Mercy Health's Oct. 1 deadline.
The agreement extends coverage for all Anthem plans, including employer-sponsored and Affordable Care Act plans, through 2028, according to a press release announcing the deal.
In a prepared statement, Anthem Ohio President Jane Peterson said the agreement does not include cost increases for members or employers.
"I'm proud that both organizations continued to focus on our shared priority: the communities we serve," Peterson said. "We worked together to creatively address affordability for our members and the financial needs of an important care provider. This agreement provides long-term stable access to care at Mercy Health without cost increases for our members and employers."
"We understand that being out of network/potentially being out of network can be very difficult, and we are pleased that patients with Anthem insurance can now see our physicians and use our hospitals at an in-network cost," Mercy Health-Lima President Ronda Lehman said in a press release Friday. "We sincerely believe that access to quality health care services is vital for our communities. This new agreement protects our patients' access to compassionate care close to home."
