Thousands of Georgians with Anthem insurance are now out of network if they visit hospitals and other facilities run by a Gainesville-based health system.
The contract between Anthem, the state’s largest health insurer, and Northeast Georgia Health System (NGHS) expired early Tuesday.
Four months ago, Northeast Georgia sent letters to about 40,000 patients, warning of a potential contract termination. Those consumers now face higher out-of-pocket costs if they use Northeast Georgia’s hospitals in Gainesville, Braselton, Winder and Dahlonega, the system’s urgent care facilities or many physician group locations.
“Despite our determined efforts to protect in-network access for patients, Anthem continues to demand terms that would negatively impact the way patients receive care at NGHS,” Steve McNeilly, vice president of managed care for Northeast Georgia, said in statement Tuesday. “We have offered Anthem a proposal that is fair to both parties, yet they refuse to work with us in a meaningful way.”
It’s unusual for a contract between a major health insurer and a hospital system to lapse without a new deal being reached. Contract disputes typically are resolved in time, often just before the previous deal expires. But in a notable exception, a contract between Piedmont Healthcare and Blue Cross and Blue Shield of Georgia (now known as Anthem) went past deadline last year. In his final year as governor, Nathan Deal publicly intervened to help the two sides reach agreement.
The latest contract impasse comes at a time when many Georgians are entering their open enrollment period for the 2020 health plan year.
Anthem issued a statement Tuesday that said the company will continue to negotiate with NGHS to come to a new agreement “that is fair, provides flexibility and protects affordability.’’
The contract end occurred “because we are standing firm for our consumers who need greater affordability,’’ said Christina Gaines, an Anthem spokeswoman.
“The latest proposals from NGHS were projected to increase costs well above other health systems in the state,’’ she said.
Cost increases “place a significant burden on consumers because any substantial price increase in the services at these facilities would be directly reflected in increases in medical expenses covered by employer-sponsored group health plans, as well as to member premiums and cost share amounts,’’ Gaines said.
The expiration of the contract shows a big gap between the two sides, said Chris Kane, a consultant with Nagle & Associates.
An out-of-network situation creates costs and problems for both Northeast Georgia and Anthem, Kane said.
He predicted that such contract stalemates will spread nationally because the ongoing consolidation of health systems and insurers ‘‘creates behemoths that want to exert their leverage.’’
In addition, retailers such as CVS are offering options for patients in outpatient services, sparking more competition for health systems, Kane said.
Anthem said it has reached out to members who may qualify for continuity of care from their current Northeast Georgia provider.
“Our consumers have placed their trust in us to deliver access to quality affordable health care, and that is a responsibility we take seriously,’’ the company said, adding that consumers can get information on www.anthem.com/nghs.
Northeast Georgia said that it “is dedicated to minimizing the financial impact of this period of disruption.’’ Patients can get information about out-of-pocket costs from its Patient Access Office at 770-219-7678.
Consumers will always have in-network access to the hospital emergency rooms, NGHS said.
“Find out whether other insurance options may be available during Open Enrollment to guarantee in-network access in the next plan year,’’ the health system said. “Call Anthem at the number on the back of your Anthem health insurance card and explain the importance of keeping your in-network access to your trusted NGHS physicians.’’
Kane said both sides will now move to “public relations positioning.”
Northeast Georgia, he said, “will appeal to employers and the general public to underscore the potential adverse impact on access and the community’s health. Anthem will attempt to convince the patients and the public that Anthem is focused on cost management and that alternatives exist.’’
Kane pointed out that the Gainesville area is dominated by NGHS. Unlike in the highly competitive Atlanta market, he said, “Anthem cannot suggest to enrollees and employers that patients can merely go down the street to another hospital.’’