Anthem customers lose coverage at Dignity Health hospitals amid contract dispute

French Hospital


Central Coast residents insured by Anthem Blue Cross recently lost most of their health coverage at a few local hospitals amid a contract dispute between the insurance company and the nonprofit Dignity Health. [New Times]

As of July 16, Anthem Blue Cross customers no longer have in-network coverage at French Hospital Medical Center in San Luis Obispo, Arroyo Grande Community Hospital and Marian Regional Medical Center in Santa Maria, each of which is part of Dignity Health’s system. Anthem Blue Cross and Dignity Health have been negotiating new contracts for six months, and each side is faulting the other for failing to agree to a deal. 

Patients can still access Dignity Health facilities for emergency medical services, an Anthem spokesperson said. Anthem is also providing transition assistance to pregnant women and patients who are undergoing treatment or who have prior authorization for Dignity Health to ensure a continuum of care.

With negotiations ongoing, Anthem says Dignity Health charges too high of rates.

“The problem is Dignity’s rates are sometimes the highest among all health systems in California, making it almost 30 percent more expensive than other health systems in the state,” the insurance company said in a statement. “We don’t think our members and customers should pay substantially more for health care at Dignity when they can receive quality care from the many other providers in our network, and we are working to fix that.”

Anthem says it recognizes the fact that costs do rise, which is why it offered Dignity increases over current rates.

Dignity Health President/CEO Dr. Robert Quinn said his nonprofit made a proposal to Anthem with rates that do not even cover hospital inflation costs and are below increases included in prior agreements.

“Dignity Health is a nonprofit health care system and California’s largest Medicaid provider and has lost money in recent years, while Anthem is a for-profit insurance company that earns billions of dollars in profits,” Quinn said in a statement. 

The two sides remain in active discussions and hope to reach a new agreement soon, Quinn said.