Town Council urges Valley Health and Anthem to resolve cost impasse

In a final agenda item before adjourning to closed session Monday night, October 19, the Front Royal Town Council passed a Resolution urging regional medical provider Valley Health and insurance giant Anthem/Blue Cross Blue Shield to continue to negotiate to a mutually acceptable resolution on the existing impasse on costs associated with renewing their contract which expires at the end of the 2020 calendar year, December 31^st.

The resolution on a motion by Lori Cockrell, seconded by Letasha Thompson, was approved by a 5-0 vote, with Valley Health employee Jake Meza who likely would have recused himself from voting, absent. There was no council comment prior to the vote, as there is an apparent community-wide consensus the two private sector health care entities need to resolve their new contract cost dispute.

Motorists passing the current WMH on N. Shenandoah Ave. may soon be thinking ‘I have to drive where for my Anthem insurance to do me any good?!?’ Royal Examiner Photos by Roger Bianchini – Royal Examiner Video by Mark Williams

As first reported by Royal Examiner contributing writer Malcolm Barr Sr. on September 28, (“Major health insurance carrier may quit Valley Health; health care costs may rise for many in 2021”) were the Anthem/Valley Health contract allowed to lapse it would impact as many as 70% of Valley Health patients, including government retirees and employees. The Front Royal Town Council resolution estimates an impact on “about 40,000 people in the Valley Health regional health care monopoly region” including those utilizing Warren Memorial Hospital in town.

Perhaps unhappily now for local governments, Valley Health is currently building a new Warren Memorial Hospital (WMH) enabled by a Town and County-approved $60-million-dollar loan through the County-Town Economic Development Authority covering a significant portion of the new facility off Leach Run Parkway’s estimated cost. The new hospital was already controversial due to the planned elimination of some services, most prominently a maternity/birthing unit.

Perhaps ironically, Meza’s reversal of previous recusals on the matter due to his employment status with Valley Health, enabled June 11, 2018, 3-1 vote (John Connolly dissenting) adding the Town’s approval of the EDA hospital financing to the County’s. With two councilmen, Morrison and Gillespie absent had Meza continued his previous recusals council would not have had a necessary voting quorum to proceed on the matter, at least at that June 11, 2018 meeting (“Birth Local’s last stand nets one ‘no’ vote on finalizing hospital financing”).

On June 11, 2018, ‘Birth Local’ activist Melanie Salins makes her final plea against preferential financial treatment for a new Valley Health hospital facility without a maternity unit as three Valley Health officials listen behind her. She and other public pleas netted one ‘no’ vote to a locally enabled EDA $60-million loan. Wonder what the vote would be today as Valley Health and Anthem play hardball on new insurance coverage contract costs?

But back to the present, Monday’s resolution notes that many people carry Anthem as their medical insurance provider through their employers, locally including public school and local government employees.

The resolution also points to the ongoing threat from the COVID-19 Coronavirus pandemic which it observes, “continues to threaten the livelihood and well-being of the Front Royal and indeed, the greater Warren County community … and would only be exasperated by the dissolution of the currently-existing Valley Health and Anthem partnership to provide quality, affordable, and in-network healthcare services to the residents and citizens of the Front Royal and Warren County community of many thousands of people.”

The resolution makes several references to Valley Health’s “de facto monopoly on many vital life-saving and critical health care provisions” in the region and cites “a moral, if not legal, fiduciary responsibility” to continue to provide its services “to residents within this geographic region” and place those Anthem-covered service costs “above the profits and pecuniary interests of Valley Health”.

The County is also considering its options should the impasse not be resolved as reported in our story “County considers options as Valley Health and Anthem insurance split” – and the supervisors have expressed a distinct preference for a resolution of the Anthem-Valley Health dispute to changes to its employee insurance packages estimated to see costs at least double.

‘Birth Local’ demonstrators outside WMH on Feb. 28, 2018. Might we see new demonstrators with different signage at WMH as the Valley Health-Anthem stare down over new insurance contract costs continues toward the year’s end?

So, will public pressure and municipal resolutions have a positive impact on what may be a high-stakes poker game between the Northern Shenandoah Valley regional health care provider and the national health care insurance giant?

Stay tuned – it’s only our health and sometimes lives on the line versus corporate and executive compensation bottom lines.

See the motion, vote, and other business and public comments to council that will be summarized in a related story, in this Royal Examiner video of Monday’s 29-minute open meeting: