Negotiations between Mount Sinai Health System And Anthem Blue Cross Blue Shield collapsed this week, forcing the New York-based health system’s providers and services out of Anthem’s insurance network.
The dispute largely stems from disagreements over reimbursement rates and contract terms. Anthem said Mount Sinai is seeking big price increases and changes that could raise insurance premiums, while the health system says payers are underpaying it and owing more than 450 million dollars for care already provided.
Mount Sinai operates seven hospital campuses and employs more than 9,000 doctors. This outage means thousands of Anthem members in New York will now face higher out-of-network costs or have to switch providers.
In a statement sent to MedCité NewsMount Sinai said it had to make the decision to drop Anthem despite its “best efforts” to resolve the situation.
“Over the past several months, Mount Sinai has engaged in repeated, good-faith efforts to reach a responsible agreement that would restore network access to our patients. Over the past month, we have made significant progress. After narrowing economic differences, Anthem refused to commit to contractual provisions intended to protect patients from excessive denials, delayed determinations, and prolonged administrative disputes. Mount Sinai cannot agree to terms that harm patient care or destabilize our system,” the statement said.
A spokesperson for Élevance SantéAnthem’s parent company, said the payer “cannot agree to changes that would significantly increase costs for New Yorkers.”
Elevance is the second largest for-profit health insurance company, bringing together $197.6 billion in revenue and more than $5.7 billion in profits last year.
“We reached agreement on payment rates and all other negotiating terms and were ready to sign a contract. At the last minute, Mount Sinai refused to move forward unless we agreed to eliminate basic consumer protections that help ensure care is appropriate and patients are not overcharged,” the spokesperson said.
The debacle shows that financial pressures on providers and payers are making contract negotiations more contentious and public.
According to Navin Nagiah, CEO of Daffodil Healthan AI platform for health plan administration and claims processing.
“Payers are under pressure on multiple fronts. From employers over rising premiums, from CMS over stricter MA benchmarks and recent RAF adjustments, and from providers over increased arbitration litigation and rising rates,” he explained.
Nagiah added that contract impasses will not solve the industry’s underlying cost problems. Instead, he argued that payers and providers will need to focus on deeper cost-control innovation, such as reducing administrative intermediaries and investing in better technology.
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