Bon Secours Mercy Health Virginia (BSMH Virginia), a health system comprising 10 hospitals, filed a lawsuit Monday against insurer Anthem Health Plans of Virginia (Anthem) for unpaid and underpaid health claims. Anthem Health Plans of Virginia is a subsidiary of Elevance Health.
The lawsuit states that BSMH Virginia and Anthem signed a series of agreements in which BSMH Virginia provides medical services to Anthem members in exchange for reimbursement from Anthem at “certain specified payment rates.” The insurer is required to pay claims between 30 and 60 days, but this does not always happen, the provider said. BSMH Virginia alleges that Anthem owes more than $93 million in outstanding unpaid and underpaid claims. The lawsuit was filed in the Circuit Court of Henrico County in Virginia.
“As health care providers, we contract with health insurance companies (private payers), including Anthem, to fairly reimburse the ministry for the cost of providing high-quality care to our patients,” said Maureen Richmond, spokesperson for BSMH Virginia, in an email. Richmond added that the unpaid and underpaid claims “significantly [impact] our ability to provide sustainable, compassionate, high-quality care for our patients and communities.”
The insurer engages in “no-pay and slow pay tactics,” in which patients and employers experience long delays before receiving an explanation of their benefits and costs, BSMH Virginia alleges. One example of this behavior is deploying its Special Investigations Unit to make “onerous requests” for medical records and “unnecessarily” audit emergency room claims, according to the complaint.
“This complaint seeks redress for Anthem’s slow pay and no-pay tactics resulting in an enormous volume of BSMH Virginia claims being arbitrarily denied, downgraded and/or pended, thereby forcing BSMH Virginia to spend an inordinate number of hours responding to excessive and unreasonable requests for additional information, and undertaking extraordinary efforts to secure payment of properly payable claims for medically necessary care rendered to Anthem members,” the lawsuit said.
The provider said that it has tried to resolve the issue with Anthem since October of 2019, when the issue was first identified.
“BSMH Virginia has tried for many years to work collaboratively with Anthem to solve its claims processing and payment deficiencies, devoting hundreds of hours of employee time to meetings and calls with Anthem and researching and answering an endless stream of repetitive and unnecessary questions and data requests — but all to no avail,” the lawsuit states.
In addition, the issue is not just in Virginia, the lawsuit alleges. As of July 31, Anthem owes Bon Secours Mercy Health (the parent company of BSMH Virginia) about $85 million in unpaid claims in Ohio and $6 million in unpaid claims in Kentucky.
The lawsuit also notes that Anthem’s parent company, Elevance Health, posted a $7.8 billion profit in 2022, while BSMH had an overall loss of $1.2 billion.
“Anthem is more than able to meet the payment obligations that it agreed to with hospitals and doctors, including BSMH,” the lawsuit declared. “These repeated payment failures constitute resources diverted away from BSMH Virginia’s nonprofit mission in the Richmond and Hampton Roads communities and into the pockets of Anthem’s corporate shareholders. BSMH Virginia cannot sit idly by and let healthcare dollars that belong to its community be taken away by Anthem’s refusal to honor the payment terms in its agreements with BSMH Virginia.”
Anthem did not return a request for comment.
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