September is shaping up as a worrisome time for thousands of Georgia patients.
Consumers are being notified that on Sept. 30, the contract between the state’s largest health insurer, Anthem, and Northeast Georgia Health System is due to expire.
That would make Northeast Georgia’s Gainesville hospital and other facilities out of network for Anthem members, who would face higher costs to continue to visit the medical system’s facilities.
Such contract disputes between insurers and hospital systems usually get resolved in time, often just before the previous deal expires. But that does not always happen, so negotiations that go down to the wire create anxiety for patients. As the deadline approaches, the patients face the possibility of losing covered access to their doctor or preferred hospital.
Separately, Anthem and state officials announced that the insurer is offering a new health plan through the Georgia Farm Bureau. That plan, known as a Multiple Employer Welfare Agreement, can offer separate – and lower – pricing to groups who are healthier, according to Anthem officials.
But the legal ramifications have confused health care experts. Such a plan would run counter to rules in the Affordable Care Act, which prohibits charging sicker people higher premiums, a practice known as medical underwriting.
Besides the Northeast Georgia impasse, Anthem has been involved in other recent contract battles. Last year, the insurer worked out a contract with Piedmont Healthcare only after their old deal had expired. And Anthem was unable to strike an agreement with WellStar Health System on one of the insurer’s exchange health plans.
Northeast Georgia, meanwhile, is expanding its reach, with an agreement to invest $15 million in Habersham Medical Center in Demorest, with hopes of buying the hospital after five years. And the system has also reopened a closed rural hospital in Dahlonega, with plans to replace that scaled-down facility with a new hospital nearby.
Northeast Georgia also runs hospitals in Braselton and Winder, besides its flagship facility in Gainesville.
In late May, the system sent out letters to about 40,000 patients, warning them of a possible Sept. 30 contract termination. Northeast Georgia said that Anthem was seeking “drastic cuts’’ in payments for medical services.
“We remain dedicated to doing everything we can to encourage Anthem to work with us on a fair and reasonable agreement before our contract expires,’’ the system says on its website. It urges patients to contact Anthem directly.
“If the voicemail box for Anthem’s Regional Leadership remains full, please use the number on the back of your Anthem insurance card. We appreciate your support in telling Anthem you need in-network access to NGHS.’’
Anthem is also sending letters to members about the contract situation.
In a statement, the Indianapolis-based insurer said that it’s continuing “to actively negotiate with Northeast Georgia Health System to reach an agreement that protects access to affordable, high-quality health care for our Georgia consumers and keeps NGHS in our provider network.
“Our No. 1 priority during these negotiations is to protect consumers’ access to affordable, high-quality health care. We believe hospitals and doctors should be compensated fairly, and this is reflected in the terms we have offered NGHS.’’
The Farm Bureau plan
On Thursday, Gov. Brian Kemp announced state approval of a new health plan that Anthem will offer through the Georgia Farm Bureau, which claims 300,000 “member families,” including Kemp himself, the Atlanta Journal-Constitution reported.
Kemp said the move was intended to give better health options to rural Georgians and lower health insurance premiums.
Anthem said it is targeting “a previously underserved population – Georgia farmers and other farm-related companies.’’
Benefits would be offered to small-group employers, who can join together to share in the overall claims risk and have financial protection backed by Anthem.
The company said the Multiple Employer Welfare Agreement would allow medical underwriting – the practice of charging higher premiums to groups that are sicker, versus groups with healthier employees.
The company told GHN on Friday that because the Farm Bureau plan is self-funded, participating groups can be medically underwritten.
Bill Custer, a health insurance expert at Georgia State University, said Friday that “it’s difficult to understand how the Farm Bureau can medically underwrite.’’
The ACA, he said, eliminated medical underwriting for purchased health insurance. Anthem and the Farm Bureau may have figured out a way to skirt that rule, Custer added.
A federal judge in March rejected the Trump administration’s attempts to expand access to association health plan rules, a type of Multiple Employer Welfare Agreement.
Under the administration, the U.S. Department of Labor expanded access to association health plans through a regulatory change. Employers can form associations solely for the purpose of creating these health plans, which don’t have to follow many ACA market rules. Insurance experts warned the regulations would draw younger and healthier consumers out of the regular insurance market.
The federal judge, John Bates, found that Labor Department rule’s interpretation of “employer” to include working owners and groups without a true commonality of interest was unreasonable and “clearly an end-run around the” ACA.
Laura Colbert of the consumer group Georgians for a Healthy Future said that with medical underwriting, “Georgians who apply for coverage through this plan or others like it may be charged higher premiums based on their health status or gender. Georgia families may also find that plans like this do not cover some hospital services, prescription medicines, mental health care, or maternity care.’’
These kinds of plans are often cheaper than those offered through the ACA because they don’t have to follow all of the same rules or provide the protections that many people now think of as standard, Colbert said.
It could leave consumers who have pre-existing conditions, who need the ACA’s full protections, facing higher premiums, she added.
Andy Miller is editor and CEO of Georgia Health News