Anthem, Dignity Health reach agreement that restores coverage to thousands of Californians
Leaders of Anthem Blue Cross said Tuesday that they have reached an agreement with Dignity Health on a new contract, settling a disagreement that had severed relationships between thousands of Californians and their Dignity doctors.
The two health care companies were unable to come to an agreement over fee increases, and Dignity informed Anthem it was terminating the contract as of July 15. However, many customers said they did not receive letters notifying them of that split until days later.
John Pickett, regional vice president of provider solutions at Anthem Blue Cross, said the new agreement is retroactive to July 15, so Anthem members will not have to pay the higher out-of-network rates required when they see a provider that does not contract with the insurance carrier.
“We are pleased to continue working with Dignity. While we understand this wasn’t easy for consumers, it was necessary for us to stand firm as part of our efforts to help slow the sharp rise in health care costs,” Pickett said. “We value our relationships with providers, which are important to creating choices for our consumers and fulfilling our mission of improving lives and communities. Our members remained our number one priority as we worked hard and in good faith to find common ground and reach an agreement with Dignity that helps protect affordability.”
Dr. Robert Quinn, the chief executive officer of the Dignity Health Medical Foundation, called the agreement “a win for our patients.”
“We deeply appreciate the patience of our patients, employers, and physicians as we have worked through this process,” Quinn said. “From the beginning, our goal in working with Anthem has always been about ensuring we can continue to meet the needs of our patients today and in the future. This agreement ensures we can continue to provide value-driven care for Anthem members.”
In a prior news release issued about the dispute, Anthem noted that “Dignity rates are some of the highest among all health systems in California, making it almost 30 percent more expensive than other health systems in the state.”
Dignity charges consumers with commercial insurance more than four times what it bills Medicare recipients for some services, Anthem leaders said, and these rate increases result in higher out-of-pocket and premium costs for its customers.
Quinn, in an interview last month, said that Dignity providers serve many of the sickest and most vulnerable Californians as the largest Medicaid provider in the state and that the nonprofit giant had been losing money in recent years. Citing budget woes in 2019, Dignity laid off roughly 110 workers.
CommonSpirit Health, the parent of Dignity Health, reported an operating loss of $550 million for the fiscal year ending June 30, 2020, and an operating loss of $617 million for its prior fiscal year. (The company received roughly $850 million in federal relief related to the COVID-19 pandemic in 2020, however. Without it, the operating loss would have been $1.4 billion in 2020.)
Dignity directed any questions to their phone line, (800) 483-1568, or to the number on the back of Anthem member cards.
