Chesapeake Regional Healthcare recently announced more than $150 million in new construction across Hampton Roads. In the same breath, the system has demanded dramatic price increases for Tidewater’s people and businesses in its current negotiations with Anthem Blue Cross and Blue Shield in Virginia. I spend my time advocating for health care affordability because it is consumers and businesses that pay for health care, and they should not bear the burden of flagrant cost increases to fund Chesapeake’s expansion plans.
Last year, Chesapeake approached Anthem with concerns about rising staffing costs amid high inflation. Knowing that our hospitals were struggling in the aftermath of the pandemic, Anthem agreed to financial terms to enhance support for the hospital, its surgery centers and its physicians starting in January 2024. But now, Chesapeake wants to increase costs again — at more than three times the inflation rate. Anthem has offered additional increases to Chesapeake for the coming years to support the continued partnership, but Chesapeake has declined to accept these offers and instead continues to demand outrageous increases.
This community has placed its trust in Chesapeake Regional for many years as their local choice for healthcare. However, Chesapeake recently notified Anthem that it will leave our care provider network unless it is permitted to excessively increase costs for our members covered by their employer or individual plans under the Affordable Care Act. In addition, it is troubling that they are terminating Medicaid and Medicare Advantage with no request for reimbursement enhancements for those populations. We have recently seen this tactic of leveraging the most vulnerable members in our community by other providers.
These price increases would dramatically impact consumers’ out-of-pocket costs. For employers, the impact would be even greater. Eighty percent of employers use self-insured health plans, meaning they pay for their employees’ care directly. Disproportionate health care costs force employers to make difficult decisions that affect hiring, paying and retaining workers. It also impacts their ability to grow their business and the Hampton Roads economy.
The provision of quality health care services, the heart of Chesapeake Regional’s mission, relies heavily on the financial viability of employers, who pay for these services through insurance. Driving rates up exponentially poses a threat to the sustainability of this essential alliance, potentially restricting access to quality care.
At Anthem, our goal is to work collaboratively with Virginia’s care providers. We believe higher quality care should receive higher payment and we understand the importance of financially stable health systems. That’s why we worked together with Chesapeake to increase payment rates just five months ago, why we have offered additional increases for the coming years that include quality incentives, and why Chesapeake is currently paid in line with other health systems of similar quality and size in the Commonwealth. Working together to improve health outcomes and achieve sustainable health care cost trends is key to success in our system.
Using patient care disruption to leverage unreasonable cost increases for consumers and employers is exactly the wrong approach — particularly when some of those patients are elderly or financially challenged and may be more impacted by care interruption and reduced access in their immediate area.
Anthem is asking Chesapeake Regional to consider the impact these price increases will have on their patients and employers in the Tidewater region and agree to extend our long-standing partnership. We ask them to work with us to achieve cost trends that maintain their financial stability well into the future and the affordable access to care that our members deserve. Most importantly, we ask them to stop using care disruption as a negotiating tool. This is all very achievable by recognizing that affordability equals access in health care, and we can accomplish more by working together to serve the physical, mental and financial health of our community.
By prioritizing access, quality and affordability, Chesapeake Regional can continue to uphold its commitment to delivering excellent care without compromising the financial sustainability of our community’s people and employers.
Monica Schmude of Vienna is the president of Anthem Blue Cross and Blue Shield in Virginia.
