LIMA — Mercy Health may go out of network for Ohioans enrolled in Anthem’s Medicaid plan Saturday if the insurance company does not agree to higher reimbursement rates by midnight Friday.
Negotiations started nine months ago as Bon Secours Mercy Health threatened to terminate the contract with Anthem, which covers an estimated 6,000 people on Medicaid in the Lima market alone, 18 months early amid payment disputes that Mercy Health officials say have resulted in $100 million in late or unpaid claims from Anthem for care already provided.
“Their payment practices are not in compliance with our current agreement,” Mercy Health-Lima market President Ronda Lehman said, describing an alleged pattern of delays and denials from Anthem that “has become phenomenally onerous.”
“We’re in a really difficult spot,” Lehman said.
This is the second dispute between Mercy Health and an insurer to become public this year after the health system reached an eleventh-hour agreement with Cigna in January.
Anthem spokesman Jeff Blunt said eleventh-hour deals “are not uncommon” and that the insurance company “remains hopeful” for a resolution.
“However, this remains a concerning situation and one that should not arise 18 months before the current contract expires,” Blunt said in an emailed statement. “Mercy Health is not seeking increased payments for our Medicaid members. They are terminating their contract to serve this vulnerable population in an attempt to force higher costs on our employer-based and individual plan members.
“We’ve asked them repeatedly to rescind this action, honor their contract and negotiate a new agreement at the appropriate time — when the current contract ends. We continue to keep lines of communication open and are committed to reaching a resolution as quickly as possible. Meanwhile, we continue to work to assist members with transitioning care to alternative care providers or, for members undergoing treatment for certain serious and complex conditions, to continue their care with their current care provider.”
Blunt disputed the $100 million in late or unpaid claims cited by Mercy Health officials as an “inflated” figure “based on the bills paid by Anthem or submitted for review, stating that the health system has “declined to provide additional information that would substantiate their claims.”
“There is always a lag in claims submission and payment as we perform our responsibility to assure claims are submitted and paid accurately,” Blunt said. “This is a critical role all health insurers play in the system. Over the last 12 months 92 percent of claims are being processed within 14 days, 98 percent of claims within 30 days.”
Still, Mercy Health officials say the health system’s labor costs increased 9.6% from 2021 to 2022, while the overall cost of care rose by 6.8% due to inflation and supply chain shortages.
Meanwhile, Anthem parent company Elevance reported $2.8 billion in earnings in the first quarter of 2023.
“We seem to be motivated by very different factors,” Lehman said. “We’re motivated by delivering care that the patients need in our community, and unfortunately, they appear to be more motivated on where their shareholders are at and what their profits are quarter over quarter.”
Early termination of the agreement will affect thousands of Ohioans on Medicaid plans managed by Anthem, who may need to find another doctor or Medicaid plan if a deal is not reached by midnight Friday.
Lima Memorial and Blanchard Valley health systems will remain in network, according to Anthem, which said it will continue to cover “medically necessary” emergency services provided by Mercy Health hospitals in Ohio if the contract ends.
Meanwhile, Mercy Health says those who signed up for Anthem Medicaid plans within the last 90 days may be able to change plans to stay in network or request continuity of care from Anthem for already those receiving specialized services like cancer or suboxone treatment from Mercy Health.
Mercy Health will remain in network for those with Medicare Advantage, individual or employer-sponsored plans through Anthem, as well as Ohioans using Anthem Medicaid as a secondary insurance provider if an agreement is not reached by midnight Friday.
