Northside Hospital Atlanta in Georgia. (Courtesy photo) Northside Hospital in Atlanta. (Courtesy photo)

More litigators are joining in for the escalating contract dispute between Georgia's top medical insurance provider and one of Atlanta's biggest hospitals.

Lawyers for Northside Hospital and Anthem Blue Cross Blue Shield are preparing for a courtroom round two. They face a Tuesday deadline for briefing in advance of a second hearing to be held sometime the following week in Fulton County Superior Court. Hospital lawyers will be arguing for extending the temporary restraining order they won the night before New Year's Eve, keeping Anthem from cutting off the contracts. Anthem litigators will be opposing that and seeking removal of the dispute to the privacy of arbitration.

"The issue is the 23rd largest for-profit company in the U.S., and the biggest health insurer in Georgia by far, is using its members' access to critical care in the middle of a pandemic as leverage to get even richer in a contract negotiation with a nonprofit community health system that puts all of its revenues back into the communities it serves," said S. Derek Bauer of Baker & Hostetler, who represents Northside along with longtime litigation counsel Robert Highsmith of Holland & Knight. They allege Blue Cross is seeking to terminate "without cause" their patients' coverage agreements, some of which have been in place for 20 years.

The disputed contracts affect coverage for patients at Northside's five Atlanta-area hospitals and affiliated medical practice groups. Anthem provides coverage to a million Georgians, including state employees and teachers. Northside holds the distinction of delivering more babies each year than any community hospital in the country.

Bauer accused Anthem of trying to "play chicken" with people's lives.

"Anthem wants more cash for stock buybacks and shareholder dividends, on which it spent more than $4.1 billion in the last 12 months. And it does that by leveraging hospitals into lower reimbursements that make it even harder to improve and replace facilities, engage in life-saving research programs and to hire and train more nurses and doctors to keep up with the unyielding demand for health care services," Bauer said.

"Anthem's pending motion asks the court for permission to take 30,000 metro Atlantans' primary care physicians away from them, with no viable alternatives for them, and to eliminate access for more than one million Atlantans to the largest cancer program in the state," Bauer said. "Those one million members include most of the state employees who get their health care through the State Health Benefit Plan, too. If Anthem is permitted to terminate Northside and its affiliated physicians from its network contrary to OCGA 33-20C-2, there will be delayed care, missed treatments and almost certainly bad outcomes—all in service of massive, multibillion-dollar profits, $24 billion in gross profits last year, to be clear."

Anthem Blue Cross has alleged that Northside is one of the most expensive health care systems in the state and that the agreements are no longer affordable. The company, represented by Jim Hollis of Balch & Bingham, sought to terminate the agreements on Dec. 31. That led to a four-hour emergency hearing on Dec. 30 before Fulton County Superior Court Judge Shermela Williams. She issued two temporary restraining orders at 7:02 p.m. that evening, blocking the termination of the agreements and directing the parties to continue negotiations and "act in good faith toward one another in complying."

Key to the judge's decision was a new law passed by the General Assembly and signed by Georgia Gov. Brian Kemp last year saying in part: "In the event of a public health emergency … an insurer shall, for a period commencing on the effective date of the public health emergency and ending 150 days after the expiration of such public health emergency … be prohibited from terminating a provider from the insurer's network."

Since that hearing, Anthem has amped up its legal team, adding litigators from Troutman Pepper that include James Washburn and former Georgia Supreme Court Chief Justice Harold Melton, who retired from the court last year.

The company has also repeated its reassurance that Northside—a public hospital—must still provide emergency services regardless of the outcome of the dispute.

"Our members can rest assured knowing that we cover emergency care, including treatment for COVID, at any provider, whether that provider chooses to be in our network or not," Anthem said in a written statement. "Ensuring access to care is why we began negotiations early and have been working in good faith for seven months to reach a new agreement with Northside."

Anthem accused Northside of obstructing the deal.

"We have given Northside a proposal with generous increases—one they could sign immediately—yet they have refused," Anthem said. "Northside wishes to continue operating under a contract that will not achieve the affordability or quality improvements we have been seeking, and our members deserve. We'd like Northside to join us in focusing solely on reaching an agreement that is in the best interests of consumers."

Williams took the case as the presiding judge on the date of the emergency hearing Dec. 30. The lawyers said they expect the case to be reassigned to Judge Paige Reese Whitaker for the next hearing.

Katheryn Hayes Tucker

Katheryn Hayes Tucker

Katheryn Hayes Tucker is an Atlanta-based reporter covering legal news for the Daily Report and other ALM publications.

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