Mercy Health seeks more reimbursement or plans to end Medicaid contract with Anthem
Bon Secours Mercy Health plans to terminate a Medicaid insurance contract with Anthem Blue Cross Blue Shield that covers 10,000 Ohioans unless the parties renegotiate a new contract by June 30.
The two companies currently have a contract that runs through 2024 to provide Medicaid insurance to patients at Mercy's 21 hospitals in Ohio. But the health system has notified its patients if a new "fair" agreement isn't made before June 30, Mercy's Ohio hospitals will no longer be in-network for patients who receive Anthem's Managed Medicaid the next day.
A representative for Mercy Health declined an interview request but in a statement, the company cited a 6.8% increase of operating expenses from 2021 to 2022 as reason for the need to renegotiate some of its contracts.
"Mercy Health contracts with health insurance companies (private payers), such as Elevance Health (otherwise known as Anthem), to fairly reimburse the ministry for the cost of providing high-quality care to our patients," Mercy Health wrote in a statement. "Unfortunately, Elevance Health’s current reimbursements – which are substantially less than other payers – have not kept up with inflation and are overwhelmingly inadequate to account for the cost of providing safe and quality care."
Contentious negotiations: Hospitals and insurance companies face off in string of contract battles
On the Cincinnati-based company's website, which answers some questions in a Q&A format, Mercy said how much Anthem "pays our doctors, nurses and other caregivers is not sustainable or market competitive," while answering why a contract termination may occur.
While negotiations are ongoing, Jeff Blunt, a spokesman for Anthem, said discussions between the two have "stalled."
"(Bon Secours-Mercy Health) has notified us of its intent to no longer accept Anthem Medicaid members unless we agree to increased reimbursement rates for employer-sponsored and individual health plans," Blunt wrote in a statement to The Enquirer. "We already have a contract with Bon Secours-Mercy in effect through 2024, which includes year-over-year increases that acknowledge and address the rising cost of providing healthcare services. This is a fair, mutually agreed upon contract that allows us to partner to meet the health needs of those we serve."
Blunt further said the action from Mercy Health would put "society's most vulnerable at risk in order to leverage higher revenues."
"If we were to agree to their requests for higher rates, on top of increases we are already providing, the result would be higher costs borne directly by businesses and individuals across Ohio," Blunt said.
Contention between Cincinnati hospitals, insurance companies continues
The latest contention follows what has become an increasing trend of stalled discussions and disputes between hospitals and insurance companies, specifically in Cincinnati.
In the final hours of March, Anthem and Christ Hospital reached an agreement to keep employer-based insurance in place for 100,000 people after months of contentious negotiations.
That followed a similar pattern of stalemates that turned into last-minute agreements between Mercy Health and Cigna in January, and Cincinnati Children's Hospital Medical Center and CareSource Ohio last June.
In each instance, negotiations threaten patients affected to become out of network, causing a stress-filled panic regarding where they might receive their care if an agreement isn't met.
"It’s very scary. It’s overwhelming when you’re in your 70s and you think about trying to work this all out," Sara Duffy told The Enquirer in March, days before an 11th-hour agreement between Christ Hospital and Anthem came to fruition.
Mercy Health has six hospitals in the Cincinnati market. Across Ohio, it also has hospitals in Lima, Lorain, Springfield, Toledo, and Youngstown.
This article originally appeared on Cincinnati Enquirer: Mercy Health threatens Anthem Medicaid contract termination
