St. Francis, Anthem finalize health insurance contract

September 1, 2009

The St. Francis hospital system has finalized a multiyear agreement with Anthem Blue Cross and Blue Shield of Indiana, ending a months-long dispute over insurance-reimbursement costs, the parties said yesterday.

The two sides announced on Saturday that they had reached a preliminary agreement before the previous contract was set to expire today.

The new pact covers 12 statewide hospitals and health care centers under the Sisters of St. Francis Health Services Inc. umbrella, including facilities in Indianapolis, Beech Grove and Mooresville. It also covers more than 300 physicians within the system's service areas.

"We recognize how difficult this has been for our patients and appreciate their support and patience during the negotiations," Jay Brehm, St. Francis' regional chief financial officer and lead negotiator, said in a written statement.

Sisters of St. Francis Health Services originally asked for reimbursement increases that would have amounted to $80 million over three years, Rick Rhodes, an Anthem regional vice president, wrote last Oct. 30 in a letter to employers covered by Anthem. The increase would mean $12 million more in out-of-pocket costs to Anthem customers. But St. Francis claimed its request for an increase would bring it in line with what other hospitals are getting.

The contract achieves Anthem's top priority of keeping health care affordable for its members, Dr. David Lee, Anthem's vice president of health services, said in a written statement.

The St. Francis system is based in the northern Indiana town of Mishawaka.


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