Anthem threatens hospitals who use out-of-network radiology providers
Anthem Blue Cross and Blue Shield is reportedly threatening hospitals that use radiologists and other physicians who are out-of-network with the health insurer.
The company recently posted a new administrative policy pertaining to healthcare facilities’ use of “nonparticipating care providers.” Effective Jan. 1, Anthem will punish hospitals utilizing out-of-network physicians with “corrective measures” including a 10% administrative penalty of the allowed amount for claims that involve out-of-network docs.
It also is threatening “potential termination from Anthem’s networks” for those that contract with out-of-network providers. Anthem said this issue is especially important when health plan beneficiaries receive an outpatient procedure or inpatient stay.
“The Facility Administrative Policy…encourages and prioritizes care to be delivered from participating care providers when a member receives services in the facility-based setting,” Anthem, also known as Elevance Health, said in the policy document, dated Oct. 1, noting that exceptions will apply. These include the delivery of emergency services, cases where Anthem has granted prior authorization, and instances when no in-network provider is available.
Hospitals also are advised not to balance-bill health plan members for the administrative penalty applied when contracting with out-of-network providers. The policy document lists states including Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, Ohio and Wisconsin.
Healthcare policy experts questioned the legality of the new strategy on Wednesday. Ed Gaines, an attorney and VP of regulatory affairs with Zotec Partners, noted that both the No Surprises Act and state laws allow radiologists and other physicians to operate out of insurance networks. Anthem attempting to penalize hospitals for working with such provider groups is a notion the “law cannot abide,” he wrote on social media.
“…Anthem’s actions may be federal anti-trust violations, violations of unfair and deceptive trade practices, RICO claims and I am sure that the [Republicans] on the Ways and Means committee would be most interested in questioning Anthem,” Gaines shared Oct. 22 on X.com. “For the state specialty societies in the states cited, and the national specialty societies, this announcement should be prioritized for possible future action,” he added, tagging organizations including the Radiology Business Management Association, American College of Radiology and the Medical Group Management Association.
RBMA said Wednesday it is aware of the Anthem policy update and is in contact with ACR and MGMA about the issue. An out-of-network radiologist in the Midwest forwarded the document to the association after a hospital administrator passed it along, according to Linda Wilgus, MBA, co-executive director of the RBMA.
“We are reaching out to the department of insurance where Anthem is headquartered for comment and working with our sister associations in this industry to find resolution,” she told Radiology Business Wednesday.
Strategic Radiology, an independent coalition of imaging groups spanning over two dozen states, could not offer comment on the Anthem policy update. A radiologist who declined to be identified indicated that at least one SR group has been impacted by the Anthem policy change.
Adam Bruggeman, MD—a spine surgeon and chair of the American Academy of Orthopaedic Surgeons Council on Advocacy—slammed the payer’s decision on Wednesday.
“When you thought insurers couldn’t get more evil, they come up with something even worse than you anticipated,” he wrote on social media in response to Ed Gaines’ original post. “So here we have an insurer that now plans to hurt hospitals who have physicians that aren’t contracted with the insurance carrier. This has so many issues.”
He listed problematic elements of the policy, including difficulties hospitals might face in figuring out which physicians are in-network. In addition, docs are going out of network due to “decades of reductions in payments,” Bruggeman wrote.
“Anthem wants the ability to lower payments to physicians without pushback or consequence,” Bruggeman added. “What this leads to is every physician vertically integrating with hospitals, which actually increases the costs to employers, patients and Anthem.”
Alaska-based radiologist Ned Holman, MD, meanwhile, defended the new Anthem policy, contending it’s necessary to rein radiology groups that have abused the No Surprises Act.
“Insurance companies need tools like this to punish private equity bad actors like Rad Partners, who are driving up healthcare costs by intentionally going out of network and abusing the NSA,” Holman told Radiology Business. “Hopefully [UnitedHealthcare] and Aetna follow BCBS’s lead.”
"I will disagree with Ned on this," responded Tarang Patel, DO, CEO of Radiology One, an independent imaging group that launched in March. "The health insurance companies have much more power than even the largest radiology groups given their size. It certainly feels like a unilateral decision. And given what docs of all specialties say, I believe them over insurance companies."
Editor's note: This story has been updated to include a quote from Tarang Patel.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.