Virtual primary and urgent care providers Carbon Health and Anthem Blue Cross of California are embroiled in a public contract dispute. Carbon Health criticized the insurer for not paying a livable wage, leading to its services no longer being considered in-network. Anthem has denied all claims and refused reimbursement, leaving some patients with out-of-pocket expenses. Carbon Health aims to retroactively submit claims and adjust charges for affected patients. The dispute highlights the challenges virtual care providers face in negotiating fair rates with insurers, with potential implications for healthcare delivery and payment models.
Contract negotiations between virtual primary and urgent care provider Carbon Health and health insurance giant Elevance Health, operating as Anthem Blue Cross of California, have become a matter of public dispute. Carbon Health recently published a blog post accusing the insurer of failing to provide a “living wage” for its services offered to members in California. The talks, which began in January 2022, attempted to set a fair salary and lessen administrative hassles for the care teams that serve Anthem Blue Cross members in California. However, citing labor shortages and rising operational costs, Carbon Health claimed that the rates provided by Anthem were no longer sustainable.
Contract Dispute and Impact:
In the blog post, Carbon Health revealed that, as of March 17th, it was no longer considered an in-network provider by Anthem Blue Cross. Despite this, the company highlighted that many insurers still rely on its services in the state. Consequently, Carbon Health attempted to recoup costs from Elevance as an out-of-network provider. Nevertheless, Anthem abruptly denied all of Carbon Health’s claims, refusing to reimburse the virtual care provider for its services. As a result, some Anthem patients were left with out-of-pocket expenses for these unreimbursed bills. Carbon Health expressed its intention to retroactively submit claims in the hopes of securing reimbursement from the insurer, promising to adjust or refund the difference for patients who had already been charged if reimbursement is received.
Future Actions and Patient Impact:
Carbon Health stated that if Anthem continued to deny claims, it would only charge patients its standard self-pay cash price. The company aimed to mitigate the financial burden on patients while seeking a resolution with Elevance. However, at the time of reporting, Carbon Health had not provided further comments or updates on the ongoing dispute.
Broader Context and Other Insurance Coverage:
Anthem Blue Cross of California was not the only insurer with which Carbon Health had coverage agreements. Carbon Health established a partnership with Blue Cross Blue Shield of Massachusetts in September, in which the health insurance company will offer its members virtual primary care through Carbon Health or Firefly Health. This partnership marked the launch of a new primary care model earlier this year. Despite the challenges faced by Anthem, Carbon Health continued to seek collaborations and expand its reach in the healthcare industry.
Carbon Health’s Recent Developments:
Carbon Health has experienced a transformative year, including two rounds of layoffs. In June 2022, the company laid off 250 employees, accounting for approximately 8% of its workforce. Subsequently, early this year, an additional 200 employees were laid off. However, amidst these challenges, Carbon Health managed to secure significant investments. Shortly after the second round of layoffs, the company announced a $100 million Series D investment from CVS Health Ventures. This funding followed a previous investment of $350 million, received just two years prior.