One of Missouri’s largest healthcare providers, Mercy, has announced a significant decision that will affect thousands of patients in the state. By the end of 2024, Mercy will terminate its contract with Anthem Blue Cross Blue Shield (BCBS), one of the leading health insurance providers in Missouri. This move, which impacts various insurance plans under Anthem, will cause a substantial shift in the healthcare landscape, especially for individuals relying on Anthem for health coverage at Mercy hospitals.
Mercy and Anthem BCBS Contract Termination
Mercy has opted to end its relationship with Anthem BCBS, citing growing financial concerns for their patients. This contract termination will affect a wide range of insurance plans, including commercial, Medicare Advantage, Affordable Care Act (ACA) marketplace plans, managed Medicaid plans (Health Blue), and HealthLink, which operates under Anthem BCBS. The change is set to take effect on January 1, 2025, unless both parties reach a new agreement before that deadline.
Impact on Commercial and Medicare Advantage Plans
If no new deal is made, Anthem will no longer be considered an in-network provider for Mercy hospitals starting in 2025. This means that patients with Anthem health insurance who wish to receive care at Mercy facilities could face higher out-of-pocket costs due to out-of-network rates.
Mercy’s decision is largely driven by financial concerns, particularly in the wake of a significant income rise for Elevance Health, Anthem’s parent company. In June 2024, Elevance Health reported a 24% year-over-year increase in net income, amounting to $2.3 billion. Mercy leaders, including Dave Thompson, senior vice president of population health and president of contracted revenue at Mercy, have expressed concerns about how these financial gains do not align with the financial burdens faced by patients.
Financial Concerns Leading to the Decision
According to Thompson, Mercy is focused on ensuring their patients can access affordable and high-quality care. He pointed out that Anthem’s pricing practices and contract demands may have a negative impact on patient affordability and access to healthcare. Thompson stated that it has kept their patient care costs significantly lower than other hospitals in the region, with 27% less costs for inpatients and 16% less for outpatients compared to other facilities in the state.
Anthem’s Response and Negotiation Updates
On the other side, Anthem has offered a different perspective on the situation. In a statement provided by Emily Snooks, Anthem’s media contact, the insurer claimed that Mercy is demanding a price increase five times higher than the current inflation rate. Snooks emphasized that Anthem had already proposed a reasonable payment increase above the consumer price index for the next two years.
Anthem’s Perspective on Mercy’s Price Demands
In addition to the price hike concerns, Anthem accused Mercy of demanding contract terms that would keep specialty medications at unnecessarily high prices, even when more affordable options are available. According to Anthem, they are committed to continuing negotiations in good faith to reach an agreement that balances the needs of patients, healthcare providers, and insurers.
Implications for Mercy Patients
As the potential contract termination looms, Mercy patients insured under Anthem BCBS plans are left facing uncertainty. However, not all services provided by Mercy will be affected by this change.
In-Network Coverage and Pharmacy Services
Mercy’s retail pharmacy locations will continue to serve Anthem patients under their current in-network coverage, despite the overall healthcare contract coming to an end. This ensures that patients relying on its for prescription medications will still receive the necessary services without disruption, even if Anthem becomes out-of-network for medical services at Mercy hospitals.
Patient Care and Costs
Mercy leaders are encouraging patients to consider alternative health plans for 2025 to ensure their care remains affordable and accessible. For patients undergoing long-term or coordinated care, It is committed to minimizing disruptions by negotiating a new contract with Anthem.
To further assist their patients, Mercy is asking those affected to voice their concerns by contacting Anthem’s customer service or by calling the number on the back of their health insurance cards. It aims to cut through the “red tape” that has made it difficult for patients to receive medically necessary care under Anthem plans.
Looking Ahead to 2025
As 2025 approaches, the situation between Mercy and Anthem BCBS remains unresolved. Mercy patients enrolled in Anthem insurance plans should closely monitor the progress of negotiations and consider their healthcare options for the coming year. Employers and patients alike are urged to review the coverage offered by health insurance providers to ensure that their preferred healthcare system remains within their network.
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FAQs
1. When will Mercy terminate its contract with Anthem BCBS?
A. Mercy is scheduled to end its contract with Anthem BCBS on December 31, 2024, unless a new agreement is reached.
2. Which plans will be affected by this contract termination?
A. The contract termination affects all commercial plans, Medicare Advantage, ACA marketplace plans, managed Medicaid, and HealthLink under the Anthem BCBS umbrella.
3. Will pharmacy services be affected?
A. No, Mercy’s pharmacy locations will continue to provide services for Anthem patients with in-network coverage.
