Anthem/Carelon Contract Concerns Threaten Mental Health Care in Indiana and Beyond:A call to action for providers, policyholders, legislators, and professional associations

Elevance Health, the controlling company of Anthem BCBS, acquired IU Health Plan, a local but sizeable insurance network in Indiana, at the beginning of 2025. With this acquisition, Elevance provides health care coverage to 3.2 million Hoosiers, the largest network in the state, four times larger than its nearest competitor and is the third largest network for Medicare clients after its recent emergence in this sector, meaning Anthem plans cover nearly half of all residents of Indiana.

Anthem sent a contract amendment to many Indiana mental health providers at 5:00 pm on Friday, June 27^th stating Anthem is merging their behavioral health network with a company called Carelon (a company owned by Anthem), contracting Carelon to provide access to behavioral health services, nullifying existing Anthem contracts, and replacing them with terms outlined by Carelon, a move that cuts reimbursement rates for mental healthcare providers by 40-57%. Individuals affected by these changes are physicians/psychiatrists and advance practice nurses who manage psychiatric medications, licensed mental health providers such as counselors, marriage and family therapists, clinical social workers, and psychologists who provide individual, family, and group therapy and complete psychiatric testing, among other roles.

Insurance contracts historically have included gag clauses in an effort to, in part, limit providers from engaging in transparent discussions about reimbursement, a dated practice that despite restrictions on this protocol outlined in the Consolidated Appropriations Act (CAA) still shapes discussions at state and national levels. These lingering provisions are in direct contrast to the No Surprise Billing requirements, a subset of the CAA rules, which places a responsibility on the same hand-tied providers to communicate clearly with clients regarding rates to avoid unexpected, out-of-network costs for services.  In an effort to walk this tight rope, the following information is intended to unite the mental health provider community across the country, inform individuals who use their mental health benefits, request support from legislators to protect their constituents, activate professional associations, educate corporations who purchase health plans, and request alliance with the public who feel mental health care is necessary to a functioning society.

Let’s begin with some perspective regarding reimbursement and what 40-57% cuts look like without directly disclosing reimbursement; these reflect the current Carelon pre-tax rates:

• ·      MD/DO appointments that lasts 39 minutes and involve changing/managing psychotropic medications would be reimbursed at approximately to the cost of two tickets to a local movie theater

• ·      Shorter medication check-ins with a doctor or advanced practice nurse reimburses about the same as a local four-minute, drive-through car wash

• ·      In Central Indiana, the cost of one hour massage exceeds (often by more than 2x) the reimbursement for a therapy session with someone who holds the minimum of a master’s degree.

• ·      The cost of a women’s hair cut in Central Indiana exceeds the reimbursement rate for a doctoral level psychologist to complete an hour of formal psych testing

Keep in mind each of these mental health providers has 6-10 years of college education, is required to carry expensive medical malpractice insurance policies, and must complete costly continuing education requirements annually, in addition to normal (and increasing) business expenses.

Who does this effect?

According to the email sent by Anthem, this applies to all Commercial, Medicare Advantage, and Medicaid programs from Anthem in Indiana. That’s everyone.

As an Anthem policy holder, how may these changes have an impact your care?

1.)   You may no longer be able to have hour-long sessions for therapy, it will be limited to 45 minutes, not because that is your provider’s view of your best healthcare interests, but because of the limitations imposed by Carelon reimbursement

2.)   Fewer providers will be in-network. Originally, Anthem stated that if providers did not accept the terms of the contract amendment, their contracts would be terminated with Anthem. They have since said their carefully worded contract was sent out in error, encouraging providers to sign the contract amendment transitioning them to Carelon’s provider network with an option to waive Carelon’s reimbursement fee schedule and stay with Anthem, expressly reserving the right to revisit this in 2026 and to transition plans with 30 days notice. The problem is Carelon then, on paper, has a large network of service providers, a requirement they must meet to sell their services to insurance groups and members; however, all of the network providers are opting out of serving their customers. This creates what is known as a “ghost network” which means you’ll get your insurance card from Anthem along with a virtual list of mental health providers, but every office you call will say, “Sorry, we’re not in-network with Carelon.” Elevance (Anthem’s parent company) and Carelon are currently being sued in the State of New York for the harm resulting from these ghost networks. (Read more HERE)

3.)   Services like psychological testing and medication management may not be covered. While service providers across the board will likely exit the network, these are already often self-pay only, making them difficult to access to many vulnerable populations.

4.) Community Mental Health Centers may experience significantly longer wait times. One component of the revised contract prohibits billing for services of a pre-licensed professionals (residents, fellows, interns, externs, associate-level providers, trainees) even when under the direct supervision of a fully licensed provider. Many community mental health centers, hospitals, and other agencies currently use this billing practice, but will not be allowed under the current contract to submit claims.

“Well, this sounds like terrible news, what can we do?”

Mental Health Providers:

If you accept the contract with the promise that Anthem clients will not change rates, Anthem can (and have verbalized intent to) move behavioral health coverage to Carelon, meaning you’re subject to the unacceptably low fee schedule. In fact, new providers attempting to contract with Anthem are redirected to Carelon and only offered the recently released, unacceptable reimbursement rates. Additionally, due to the network leasing clause, they can potentially sell your reduced-rate services to any other insurance base with 30 days notice.

Accepting an amendment that transitions you to Carelon at their current rates is not a sustainable decision, even if they allow you opt out of the Carelon fee structure. Any acceptance of the contract requires you to represent yourself as a Carelon network provider, which is unethical if you do not intend to accept Carelon clients. It makes providers complicit the insurance industry selling plans that create ghost networks. Negotiating contracts must happen before the transition, particularly because they intend to automatically enroll you unless you expressly decline the amendment.

Consider signing the petition below to:

A.)  Amend the Carelon fee schedule to bring reimbursement rates to market value at or exceeding the current Anthem contracted reimbursement rates for all behavioral health service codes, or

B.)   Have Anthem, not Carelon, continue to manage behavioral health services under the terms of the current contracts, and

C.)   Only count toward Carelon’s identified provider network those providers who accept, in full, the Carelon contract and do not mislead the public into purchasing coverage from a network without a sustainable provider base to care for its policy holders

Individuals who utilize mental health benefits and concerned citizens:

The most influential role in this issue is held by executive teams and human resource departments for large organizations that are covered by Anthem plans. Please reach out and ask your HR department to demand answers from Anthem in writing as to whether Anthem intends to transition your behavioral health coverage to Carelon in 2026. If the answer is yes, consider whether you want to continue purchasing their policies, knowing access to mental health care will be extremely limited and/or require high out-of-pocket costs. Inquire about your out-of-network benefits to inform yourself fully regarding your options.

You can also avoid use of Venture Capital (VC) backed mental health service providers and large private equity mental health like BetterHelp, Alma, TalkSpace, Calm, etc who are eating up small, independent businesses across the country, artificially influencing network size and reimbursement rates, and have the potential for back-door partnerships with insurance companies. The recent changes leave small business providers wondering if a push to VC companies is the ultimate goal, leaving providers at the whim of big business through marketshare consolidation and potential monopolies.

Legislators, State and National Boards, and governing bodies:

Mental health providers have a difficult and important role, navigating the clinical world as well as business management components. As small businesses, we have fewer resources compared to the muscle of national insurance companies and their endless team of contract attorneys. We require your protection. Allowing an insurance company to rebrand simply by changing their letterhead and subsequently slashing contracted rates by half will create a domino effect, potentially opening the door for other insurance companies to follow suit, and certainly resulting in a deficit of qualified care in the mental health industry given the scope of Anthem's coverage. The Department of Insurance is tasked with ensuring fair and equitable insurance practices to support a stable market. These practices, if implemented, will disrupt access to care and close small businesses. Our colleagues nationally can attest the direction we’re headed is not sustainable and we need your support in Indiana, New York, Michigan, Colorado, Wisconsin, Connecticut, Maine, Missouri, Ohio and every other soon-to-be-affect state. We need you to work with us immediately, directly, and transparently to resolve these issues.

Anthem/Carelon:

Indiana providers are deeply committed to our clients, our profession, and our colleagues. We are in-network with Anthem and have been successfully providing quality care to your members. We are ethically bound to avoid misrepresentation to our clients and do not want to serve as a ghost network that allows Carelon to continue to sell their plans to unknowing policy holders under the guise of being insured by Anthem and the reputation Anthem has established in the market over decades. The only solution lies in bringing Carelon reimbursement to market rates at or exceeding the existing Anthem fee schedule or maintaining the contracts, without amendment, under Anthem at existing contracted rates without including providers in the Carelon network.

Who can sign the petition:

Mental Health Providers Nationally

Anthem-paneled healthcare providers of any specialty

Individuals responsible for purchasing healthcare policies

Anthem Policyholders

Carelon Policyholders

Individuals financially responsible for an individual covered by Anthem/Carelon

Other individuals who are directly affected by this change

Sign the Petition

Some encouraging news:

Previously, Anthem tried set limits on the length of time they would reimburse for anesthesia during medical procedures. Pushback from the American Academy of Anesthesiologists and government officials stopped the implementation of this policy (Read more HERE).

Let me ask you this: If you asked employees of any industry to come to work tomorrow, do the same job, and only get paid 43-60% of their current salary, would they show up?