Mainers are caught in the middle of the Anthem Dispute.
Credit: George Danby / BDN

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Trey Stewart of Presque Isle represents District 2 in the Maine Senate. He is the Senate Republican lead for the Health Coverage, Insurance and Financial Services Committee and the Energy, Utilities and Technology Committee.

When Anthem Blue Cross Blue Shield Maine’s President Denise McDonough and MaineHealth CEO Andrew Mueller appeared before the Health Coverage, Insurance and Financial Services Committee, of which I’m a member, it was already reported that MaineHealth decided to pull Maine Medical Center out of the national insurer’s network due to a contract dispute.

April’s hearing was a chance to hear from both sides, because about 300,000 Mainers — including more than 25,500 state employees — have Anthem as their insurer. It also drew widespread interest from stakeholders across the state, including the medical community, patients, regulators and employers.

The dispute centers around a reported $70 million that MaineHealth says it’s owed from Anthem for incorrectly denied or reduced claims. It also cited the way in which Anthem unilaterally makes policy changes to the contract, as well as its denial of procedures like a lymph node biopsy from a cancer patient who was already undergoing a hysterectomy.

During testimony, MaineHealth also claimed Anthem reduced payments on the backend for pharmaceuticals in pursuit of pass-along savings MaineHealth receives under the federal 340B Drug Pricing Program, although the program wasn’t meant for insurers.

Anthem fired back, saying the state’s largest health network was overcharging for its services. It also said MaineHealth repeatedly refused to provide any supporting data for its charges, and that charges were flowed through Maine Medical Center at higher rates, although services may have been rendered elsewhere within the system. Anthem also rebutted the claim about the biopsy denial, saying MaineHealth was duplicating surgical charges covered by the first claim like anesthesia.

Sounds like a typical contract dispute, right? Well, like everything else regarding our convoluted health care system, it depends on how many layers of the onion you want to peel.

What’s not helping Anthem’s case is the insurance industry itself, which is well known for maintaining its margins and not losing money. Here’s how it appears to work: If claims are too high, increase insurance premiums to recover it. Need more profit? Deny claims. And according to MaineHealth’s CEO, Anthem does just that in protecting a 5 percent to 6 percent margin on its $140 billion in annual revenue.

On the other hand, what doesn’t help the $3-billion-a-year MaineHealth is the totally believable claim that health care institutions overcharge for services — the federal government has fought that kind of upcoding fraud for years through Medicare. And anyone who has dealt with their own medical bills has likely disputed charges that didn’t belong there, or found others upcoded to more serious, therefore more expensive categories.

And let’s be real — does it really cost $50 for a Tylenol or $132 for a saline bag?

So yes, we expected a showdown from two Goliaths in their respective industries. But like any court case, it’s what’s outside their own testimony that is more telling.

The Maine Medical Association said Anthem’s downcoding and claim denials have been happening for years, and the insurer even failed to process claims due to software errors surrounding provider identification numbers. The association claimed that it has forced many providers out of Anthem’s network, and the Maine Bureau of Insurance is currently undergoing a market conduct examination after receiving similar complaints from the chiropractic, osteopathic and podiatric professions among others.

It also doesn’t help that other states have cited Anthem for such shenanigans, including a $5 million fine by Georgia’s Bureau of Insurance for a years-long pattern of slow payments and excessive denials. In fact, Anthem had about $350 million in unpaid claims across Maine last year, with $120 million of it over 90 days, according to  the Maine Hospital Association.

For the sake of consumers, we hope both parties can work this out. But the public airing of MaineHealth’s grievances, a whole industry piling on Anthem in its wake, and Fore River Urology and Coastal Women’s Healthcare just announcing they’re also leaving the network over some of the same issues is likely just the tip of this iceberg