Bon Secours Mercy Health and Anthem Blue Cross Blue Shield have agreed on a new multi-year contract following years of network disputes between the Catholic health system and the Elevance subsidiary.
Bon Secours and Anthem have been at loggerheads since 2019 over contract negotiations, but reached an impasse this summer that caused tens of thousands of Anthem members to no longer be in-network at Bon Secours facilities in multiple states.
Since the start of August, roughly 19,000 of Anthem’s Medicare Advantage members in Virginia and 50,000 of Anthem’s Medicaid members in Ohio have been out of network with the system.
Anthem MA members in Ohio and Kentucky and Medicaid members in Virginia were set to go out of network at the beginning of October if a contract hadn’t been reached.
Original commercial, Medicaid and Medicare contracts between Bon Secours and Anthem were set to expire at the end of 2024, but Bon Secours said it was forced to trim the payer from its networks after Anthem’s reimbursement rates didn’t keep pace with the rising cost of labor and supplies.
Bon Secours then sued Anthem in late August, alleging $93 million in unpaid claims and lost revenue.
With the new contract agreement, Bon Secours will be in-network for Anthem MA and Medicaid members until 2028. The agreement also extends coverage for Anthem employer-based and Affordable Care Act plans, according to the Friday release.
Anthem has agreed to retroactively reimburse claims that members incurred during that out-of-network period, according to an insurance carrier notice on Bon Secours’ website. Bon Secours has also agreed to toss the lawsuit as part of the deal.
Further details of the agreement are not being release due to confidentiality provisions in the contract, the companies said.
Payers and providers are perennially at odds over negotiated rates, but more disputes are leaking out into the open as health systems request higher reimbursement to alleviate rising costs, while insurers try to keep costs low.
Bon Secours is owned by parent company Bon Secours Mercy Health, a nonprofit Catholic system that operates 48 hospitals in seven states and Ireland.
Elevance operates BCBS subsidiaries in 14 states, including Anthem BCBS of Virginia.