The Ohio Department of Medicaid has rejected a request from Mercy Health to switch 50,000 Medicaid enrollees from Anthem to other Medicaid health plans because of a protracted contract dispute.
In a strongly worded letter Tuesday from Ohio Medicaid Director Maureen Corcoran to Mercy Health, Ms. Corcoran said Medicaid had rejected the idea when Mercy Health had first proposed the idea earlier this month, and the decision still stands.
The letter was addressed to Don Kline, chief operating officer of Bon Secours Mercy Health, the Cincinnati-based parent company of Mercy Health that operates in several states.
“It is indeed unfortunate that Ohio Medicaid members find themselves in the position of having to make potentially urgent or otherwise significant health care decisions because of a disagreement between two established and committed health care organizations that have told us that they have these members’ best interests at heart,” Ms. Corcoran wrote.
Anthem Blue Cross and Blue Shield of Ohio is part of giant health insurer Elevance Health based in Indianapolis.
Mercy has set a July 31 deadline to terminate its Medicaid contract with Anthem if it does not get rate increases for its hospitals and physicians.
After that date, Mercy says it will not accept the insurance coverage of Anthem Medicaid enrollees who want care.
In that case, those Anthem Medicaid enrollees would have to change doctors and hospitals or switch to an alternative Medicaid insurance plan that has Mercy in its network.
In Northwest Ohio, about 26,000 Anthem Medicaid enrollees use Mercy facilities. Statewide, the number is about 50,000.
The local flagship is Mercy Health St. Vincent Medical Center in Toledo. The other hospitals are Mercy Health St. Charles Hospital, Mercy Health St. Anne Hospital, Mercy Health Tiffin Hospital, and Mercy Health Hospital of Defiance.
Mercy Health for months has ratcheted up public pressure on Anthem for a rate increase. It first imposed a July 1 deadline to terminate its contract with Anthem’s Medicaid book of business if it didn’t get the higher rates, then extended the deadline until July 31.
Mercy says the rates Anthem pays it are too low to cover medical inflation of 6 percent annually caused by the rising costs of labor and supplies.
Anthem counters that its contract with Mercy already accounts for medical inflation. And Anthem says Mercy is using vulnerable Medicaid enrollees to try to get a mid-contract price increase that is really aimed at getting a better deal for treating Anthem employer-sponsored and commercial customers.
Mercy’s contracts with Anthem across all lines of business — Medicaid, Medicare, and commercial — were signed in 2022 and were set to run through 2024. Medicaid is the state-administered health insurance program for the poor.
In the letter from Ms. Corcoran to Mercy’s Mr. Kline Tuesday, the Medicaid director said both sides acknowledge that the dispute is really about rates that Anthem is paying Mercy for commercial insurance, not the Medicaid coverage.
The Department of Medicaid “will not use its members as an incentive to force a resolution to that commercial, non-Medicaid disagreement. I strongly encourage BSMH and Anthem to put their business dispute on another track and leave individuals served by Ohio Medicaid out of it going forward,” she wrote.
Since Mercy made the dispute public earlier this summer, it has been encouraging Anthem Medicaid enrollees to switch to other plans who have secure contracts with Mercy.
Then on July 20, Mercy wrote to the Ohio Medicaid department seeking intervention into the dispute.
In addition to requesting that the department unilaterally reassign Anthem’s Medicaid members to other plans, Mercy asked the department to freeze Medicaid enrollment at Anthem so that new enrollees can be informed that Mercy facilities would not accept the insurance coverage.
In her letter, Ms. Corcoran said that request is denied because the department is already making enrollees aware of the dispute.
Also, Mercy asked for a special open enrollment for Medicaid enrollees so it is easier for them to switch out of Anthem to a plan that participates with Mercy. Again, that was rejected as unnecessary by Ms. Corcoran.
And Mercy asked the department to investigate whether Anthem enrollees have adequate access to care in Youngstown and Lima if Mercy facilities are no longer in the network. All Medicaid health plans have a duty to ensure easy access to care for enrollees, the health system said.
Ms. Corcoran responded that Anthem’s access is adequate across the state.
Mercy spokesman Erica Blake said the system is taking the steps to “ensure that the patients retain access to their trusted Mercy Health providers.”
Mercy has argued that the rate increases are necessary so Mercy can afford to meet its mission to provide the highest quality of care, while continuing to support efforts to improve health in the community.
Anthem said the decision to terminate its Medicaid enrollees was Mercy Health’s alone.
“Because Mercy Health has chosen to refuse Anthem Medicaid coverage effective August 1, 2023, we are assisting our Medicaid members to transition elective care to one of the many high-quality health systems in our network,” said Anthem spokesman Jeff Blunt.
“We are also working with Mercy Health to assist members who require continued care with their current provider for certain serious and complex conditions,” he said.
Those are for patients with cancer, who are pregnant, have behavioral health issues, or other conditions where keeping patients with their current Mercy physicians and hospitals are critical to continuity of care.
In those situations, Anthem is required to negotiate case-by-case rates for those individuals under the terms of its contracts with Ohio Medicaid.
Mr. Blunt declined to comment on Mercy’s request to Medicaid to have its Mercy-using enrollees reassigned, saying that in the sole purview of Medicaid.
Anthem also said the health plan would have no problem providing proper access to its enrollees without Mercy.
“Anthem’s care provider network meets or exceeds adequacy requirements in every location Mercy Health offers services, and we are continually evaluating our network to ensure care availability for those we serve,” Mr. Blunt said.
First Published July 25, 2023, 7:11 p.m.
