Anthem is cutting out-of-network health coverage in a ‘bait and switch,’ lawsuit says
By Melody Petersen
Los Angeles Times, November 1, 2016
On the first day of Obamacare open enrollment, a consumer group sued Anthem Blue Cross for attempting to automatically renew policies that no longer cover out-of-network costs for hundreds of thousands of Californians.
A lawyer for Consumer Watchdog said Tuesday that Anthem was “railroading existing members into bare-bones plans” without properly disclosing the change to them in recent renewal letters.
On top of the loss of out-of-network coverage, many of the customers also face big premium hikes.
Consumer Watchdog’s lawsuit says Anthem engaged in a “bait-and-switch” scheme. The group’s attorneys said Anthem should have sent the customers a “discontinuation” notice to properly inform them that they were losing their out-of-network coverage. Instead the insurer sent notices saying the policies would automatically renew if the member takes no action by Dec. 15.
Darrel Ng, an Anthem spokesman, said his company had changed the plans’ design “to mitigate rate increases and keep monthly premiums affordable.”
“The benefit package being offered in 2017 was approved by the Department of Managed Health Care and Covered California and is consistent with federal guidance,” Ng said. “Affected members have been mailed written notice of this change so they can make an informed decision on their healthcare needs during the open enrollment period for the coming year.”
The change, effective Jan. 1, affects policyholders who had signed up for Anthem’s preferred provider organization, or PPO.
In most areas in the state, Anthem is changing its PPO into a so-called exclusive provider organization, or EPO — which means that it will no longer pay even a portion of bills from doctors or hospitals not in its network.
By Don McCanne, M.D.
Once again, using the legitimate excuse that they need to keep premiums affordable, insurers are shifting more costs to patients. In this instance, California’s Anthem Blue Cross is no longer going to pay anything for often unavoidable out-of-network health care. They will do this by switching their CaliforniaCare plans from PPOs (preferred provider organizations) to EPOs (exclusive provider organizations).
As an example, unsuspecting patients caught off guard may find that their specialists providing them with essential health care services are no longer covered by their plan.
This is yet one more example of the one-way march to save money for the insurers’ risk pools by further impairing coverage of essential medical services, for the sole reason of protecting the insurer’s business model.
This march began with the advent of the managed care revolution and accelerated since the enactment of the Affordable Care Act – not because of the Act itself but rather because of the failure to enact a model that would control health care costs while removing financial barriers that impair access to care.
The model that would work, of course, is a single payer national health program. The nation’s failure to enact such a program can only lead us further down the insurers’ primrose path – pleasing the insurers while compounding the disastrous consequences for patients. We surely will not actually allow them to lead us all the way to the everlasting bonfire, would we?