Anthem, Stamford Health at odds over coverage, price hikes

CT Examiner – Monday, December 9, 2024
By Angela Carella

STAMFORD – Last month Stamford Health sent a warning letter to patients who are insured by Anthem Blue Cross and Blue Shield.

The letter from Kathleen Silard, president and CEO of Stamford Health, alerted patients to possible bad news ahead. But it had nothing to do with their bodily well-being.

It was about their financial well-being.

Silard explained that Anthem members who use services provided by Stamford Health – which includes Stamford Hospital, the Tully Health Center, the Bennett Cancer Center, and multiple medical offices in Stamford and surrounding towns – are in-network.

It means Anthem members pay less for care because of a contract between Anthem and Stamford Health.

But, Silard wrote, the contract expires at the end of the month. If that happens, Anthem members will be out-of-network, meaning they will pay more for care provided by the large network of Stamford Health physicians and medical professionals.

Stamford Health is “negotiating a new contract with Anthem but we have not yet reached an agreement like we have successfully done with all other insurance providers in the area,” Silard wrote.

“Going out-of-network” is “a last resort,” Silard wrote, but it may happen.

For patients who want to avoid high out-of-network costs, one option is to change insurance providers “before open enrollment ends on January 15,” Silard wrote.

The other option is to change medical providers to ones outside the Stamford Health network.

Parties point fingers

State law automatically extends existing rates for 60 days beyond the expiration of a contract, so in-network prices will continue through March 1.

If a new agreement is not reached by then, out-of-network rates will kick in for Anthem members.

Asked about the contract dispute Friday, Stamford Health Communications Director Andie Jodko provided more detail.

“After months of attempting to engage Anthem in good-faith negotiations, Stamford Health’s three-year contract is set to expire on December 30,” Jodko said in an email. “Following the … 60-day cooling-off period, patients will be out-of-network beginning March 2 … unless an agreement is reached.”

As a not-for-profit, Stamford Health works “to ensure the long-term sustainability of high-quality care in our region,” Jodko said. “Unfortunately, many of the same economic headwinds facing nearly every industry, including increased costs of supplies and labor, are also impacting health-care systems across the country.”

Stamford Health relies on “payers, including Anthem, a for-profit insurance company, to reimburse at a fair market rate for the services we provide their members, our patients,” Jodko said.

Anthem posted its position on its website, www.anthem.com.

It says Stamford Health is “already one of the most expensive health systems in Connecticut, with prices 30 percent higher than other systems.”

According to Anthem, Stamford Health is demanding price increases over the next three years that would be more than double the rate of inflation, which would mean higher out-of-pocket costs and premiums for patients.

Anthem posted examples of how much Stamford Health prices would increase by 2027: $9,899 more for a knee or hip replacement; $4,839 more to deliver a baby; $1,015 more for an emergency room visit; $815 more for a CT scan; and $673 more for an MRI.

“Anthem has offered reasonable and fair payment that keeps health care affordable for our members,” a statement on the company’s website reads. “These increases are in line with what other Connecticut health systems receive. So far, Stamford Health has refused these offers.”

Jodko said Stamford Health’s contract terms are in line with the industry.

“The rates that Stamford Health is pursuing are consistent with what we have been able to successfully achieve with all other major insurance companies – Cigna, Aetna, United, and ConnectiCare,” Jodko said. “For 2025, the state approved rate increases for Anthem to pass along to their consumers in the form of increased monthly premiums, which are well above the increases that Stamford Health is currently seeking.”

Municipal workers beware

In her letter, Siladi wrote that Stamford Health is “working diligently to reach an agreement.” Anthem’s website includes this statement: “Anthem will continue to work hard to negotiate a new contract with Stamford Health before March 1.”

The contract dispute affects all Stamford Health patients insured by Anthem, but concern is consolidated among those who work for municipalities, boards of education, quasi-public agencies, and public libraries.

Many local public employees are covered by the Connecticut Partnership Plan. The state established the plan in 2016 to help municipalities cut health-care costs by allowing their employees to join the state’s health plan for its employees.

The Connecticut Partnership Plan is cheaper because the state uses two private health-insurance companies, Anthem and Aetna, to administer Medicare Advantage Plans. Anthem covers municipal employees, active and retired, who are under 65. Aetna covers those 65 and older.

The City of Stamford has been migrating public employees to the Connecticut Partnership Plan for several years. All but two departments have switched from the city’s former Medicare supplement plan to a Medicare Advantage Plan administered by Anthem or Aetna. The remaining departments, police and firefighters, are set to switch to the state plan on Jan. 1.

Stamford officials have said switching will save the city tens of millions of dollars over time.

But public employees, particularly retirees, don’t like the Medicare Advantage Plans run by private insurance companies like Anthem and Aetna.

They say they prefer the Medicare supplement plan the city has been using because it allows them to choose just about any doctor; most doctors accept Medicare; and few medical procedures require prior authorization.

Private Medicare Advantage Plans, by contrast, require in-network doctors and prior authorization for many procedures, and they are not accepted by many medical providers because they impose cost-control restrictions, public employees say.

Lawsuits, labor complaints

Stamford retirees have filed lawsuits and the police and firefighter unions have filed labor complaints over the switch, saying it diminishes their benefits and so breaches their contracts.

Retired police officer Paul Longo filed one of the lawsuits.

“Now I am covered by Medicare and the city’s self-insured supplement plan. I can go to any doctor or medical facility in the country that is in Medicare’s network, which is just about all of them, and I’ll be covered,” Longo said.

The Anthem-Stamford Health dispute illustrates “the risk of being enrolled in private insurance,” Longo said. “The insurance company can say, ‘We don’t want to cover this network of providers any more.’ If you live in the city they’re pulling the plug on, you have no in-network coverage.”

Out-of-network costs are significantly higher, said Brendan Keatley, one of a group of retired firefighters who’ve sued the city.

“The bigger picture is that you have all these people who pay their premiums, go to work every day, and expect a certain coverage. Now that’s threatened by two large corporate entities, Anthem and Stamford Health. An individual doesn’t have any redress from this,” Keatley said.

“What happens if they don’t come to a deal? All these people won’t be able to go to a hospital that dominates a large part of Fairfield County. What if the same thing happens with Yale or another hospital?” Keatley asked. “It seems the more these for-profit insurance companies get involved, the worse things get.”

An improper ‘Robin Hood’

The Connecticut Partnership Plan is run by the Office of the State Comptroller. Asked Friday whether the contract dispute between Anthem and Stamford Health raises a red flag for the state plan, Madi Csejka, spokesperson for the comptroller’s office, provided this statement: “The Office of the State Comptroller is committed to ensuring members on our state employee plan and partnership plan have access to high-quality, cost-effective care. While we do not play a direct role in Anthem’s contract negotiations with hospitals, the comptroller has urged Anthem and Stamford Hospital to reach an agreement that is financially sustainable for both parties, patients, and the overall health-care landscape of Connecticut.”

The difficult system creates a feeling of helplessness in the face of a powerful health insurance industry, Keatley and Longo said. It generates an angry undercurrent, they said, citing the killing Wednesday morning of UnitedHealthcare CEO Brian Thompson.

The gunman who shot Thompson outside a midtown Manhattan hotel left three bullet casings printed with the words “deny,” “defend” and “depose.” Social media commentators quickly drew a comparison to the 2010 book, “Delay, Deny, Defend: Why Insurance Companies Don’t Pay Claims and What You Can Do About It.”

Online contempt for the health insurance industry, and UnitedHealthcare in particular, overwhelmed sympathy for Thompson. During his tenure the company was vilified for ruthlessly pursuing profits by denying huge numbers of claims.

“Sending prior authorization, denied claims, collections & prayers to his family,” wrote one person on TikTok.

Many posts referenced an announcement from Anthem that it would no longer cover the cost of anesthesia for surgeries that run too long. Anthem withdrew the policy on Thursday.

Thompson’s killer “is turning into some kind of Robin Hood character,” Longo said. “That’s how bad things are.”

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