In a potentially precedent-setting case, a class-action lawsuit filed last week against Anthem Blue Cross and Blue Shield seeks to prevent the Blues plan from pulling its Medicare HMO from 22 counties in rural Ohio.
The suit was filed June 30 in the Greene County Court of Common Pleas on behalf of about 20,000 Medicare HMO enrollees in those counties by attorney Charles Rowland of Xenia, Ohio.
The lawsuit seeks temporary and permanent injunctions barring Anthem from canceling Medicare HMO coverage in the affected areas and unspecified financial damages.
At press time, Rowland could not be reached for comment. But he has been quoted as saying, "We want to make sure these people are protected."
Because the suit followed hard on the heels of Anthem's late May announcement that it would cease offering the Medicare HMO plan in much of rural Ohio, it could raise questions among providers that are considering launching Medicare provider-sponsored organizations. And fewer seem to be considering it (See related story, below).
It may be that any attempt to exit a Medicare market strongly risks a similar lawsuit by aggrieved seniors who were coaxed into the plans by market-hungry insurers or providers.
The complaint charges Anthem with breach of contract, consumer fraud, breach of fiduciary duty and bad faith.
Officials at Cincinnati-based Anthem said they have not seen the lawsuit and declined to comment, said spokeswoman Lauren Green-Caldwell.
Anthem said in late May that it will withdraw its Anthem Senior Advantage Medicare-risk plan from 19 counties in rural Ohio and parts of three other counties as of Dec. 31, largely because of concerns about Medicare reimbursement rates (June 15, p. 26). Four other health plans or hospital systems have made similar decisions recently: PacifiCare of Utah, PacifiCare of Oregon, Intermountain Health Care and Health Net. And others, including New York's Empire Blue Cross and Blue Shield, have considered the option.
Nationally, Medicare capitation rates this year range from a high of more than $780 per enrollee per month in parts of the New York metropolitan area to a floor of just $367, giving plans a strong financial incentive to avoid low-paying regions.
Anthem's announced exit caused a firestorm of protest in rural Ohio and inspired Sen. Mike DeWine (R-Ohio) to demand that the health plan reverse its decision and hold public hearings to explain to enrollees what options are open to them. In at least six counties, no other Medicare risk plan is available, DeWine noted in a June 20 letter to Anthem.
The class-action suit is the latest attempt to stop the exodus, which is part of a broader trend by health plans that say they can't make money in the Medicare risk market in much of rural America and in some urban markets.