By Howard Wilkinson
and Tim Bonfield
The Cincinnati Enquirer

Cincinnati's largest health-care system and the area's Blue Cross/Blue Shield program came to an agreement early Friday that gives the Health Alliance of Greater Cincinnati a raise and gives the health insurance company a multiyear deal.

Meanwhile, thousands of Anthem Blue Cross/Blue Shield-covered families, hundreds of employers and the rest of Greater Cincinnati's health care system get relief from a potentially serious headache.

The old contract between the Health Alliance and Anthem expired Dec. 31, leaving patients bewildered about whether their doctor visits and surgeries were covered by insurance. The new one will give Anthem's members access to the Health Alliance's six hospitals, along with its surgery centers and Alliance Health Care physicians through March 31, 2006.

Both sides agreed that they would spend the next 90 days working out unspecified details of the agreement.

"In the meantime, we are in with Anthem and its products," said Gail Myers, a spokeswoman for the Health Alliance, which includes Christ, University, St. Luke, Jewish and Fort Hamilton hospitals.

Myers said that if the remaining issues cannot be worked out in 90 days, the agreement will still be in place, but it will last only until March 2005 instead of 2006.

The new deal will be retroactive to Jan. 1 - a relief to many Anthem members, who feared their out-of-network medical expenses would not be covered. Last week, the Health Alliance announced it would cover the difference between "out-of-network" and "in-network" costs.

The city of Cincinnati is one of the largest local employers that offers Anthem Blue Cross/Blue Shield to its employees, 6,400 of them. Friday, Mayor Charlie Luken said that the agreement was "a relief for a lot of people."

"It's been on the mind of every city employee," Luken said.

Now, Luken said, the city and other employers must wait to see the fine print of the agreement before deciding if it will affect employees' share of health-care costs.

In the negotiations, , Anthem agreed to pay an unspecified increase in rates for the Health Alliance's six hospitals, its Alliance Primary Care doctor group and for several hospital-owned, free-standing diagnostic centers.

In return, Anthem - which has about 350,000 area members - got a 27-month deal. Insurers generally like long-term deals that make it easier for them to predict costs.

Also, Anthem did not agree to Health Alliance requests that would have restricted what kinds of products the company could offer and would have restricted Anthem's ability to do business with a free-standing heart hospital, should one be built in the area.

"We will maintain the flexibility to create new products and to include providers that best serve our customers," said Paul Beckman, vice president of health-care management at Anthem, which is based in Indianapolis.

Anthem officials say they also obtained an "equal rate provision," in which the insurer was assured it would be offered at least the same discounts that the hospital system may offer to other insurers.

Caught in the crossfire

In the meantime, some patients say they got caught in the crossfire between insurers and the health-care system.

Patricia Pearson said she was scheduled for major surgery at a Health Alliance hospital on Jan.7. But, the 49-year-old Villa Hills woman said, her doctor told her it would not be covered at that hospital because of the lack of an agreement with Anthem.

The surgery was rescheduled for Jan. 20 at a non-Alliance hospital, she said. Now that there is an agreement, Pearson said, her surgery has been pushed back to Jan. 27 at the original hospital.

"I could have had this surgery over and done with by now," Pearson said. "It's very frustrating."

Beckman said hospitals in Greater Cincinnati deserve praise for being among the most cost-effective in the country and deserve to be fairly paid. But, he said, with health-care costs rising at double-digit rates, insurers still need to get the best deal they can for employers.

When the contract expired Dec. 31, there were serious questions raised about whether other area hospitals - already busy with flu and other winter illnesses - could take on the extra cases of Anthem Blue Cross/Blue Shield members shut out of Health Alliance facilities.

The Health Alliance eased some of those concerns with its agreement to accept out-of-network payments from Anthem while treating patients as if they were in Anthem's networks. Some specialists did reschedule some surgeries to non-Alliance hospitals since Jan. 1.

E-mail hwilkinson@enquirer.com; tbonfield@enquirer.com