November 17, 2025
What You Need to Know: CMA has joined a national federation letter urging Anthem to rescind a new administrative policy that would penalize hospitals when out-of-network physicians provide care. While the policy does not currently apply in California, physician organizations warn that similar actions could follow and threaten patient access and independent practices nationwide.
The California Medical Association (CMA) has signed onto a national federation letter calling on Elevance Health, the parent company of Anthem Blue Cross, to withdraw its recently announced policy, Facility Administrative Policy: Use of a Nonparticipating Care Provider.
Although the policy is not yet slated for implementation in California, CMA cautions that it could set a troubling precedent for other states. Beginning January 1, 2026, the policy is scheduled to take effect in 11 states (CO, CT, GA, IN, KY, ME, MO, NV, NH, OH, WI). Under the new rules, Anthem Blue Cross and Blue Shield plans would assess a 10% administrative penalty on facility claims whenever out-of-network physicians are involved in a patient’s care. The insurer has also indicated it may terminate hospitals from its network for continued use of nonparticipating physicians.
Physician organizations across the country warn that the policy undermines the bipartisan No Surprises Act (NSA), which protects patients from surprise medical bills without forcing physicians into network contracts. In the federation’s letter to Elevance Health President and CEO Gail Boudreaux, signatories wrote that “Anthem is attempting to bypass the negotiated bipartisan policy under the NSA,” noting that the law already establishes a process for resolving out-of-network billing disputes between physicians and health plans.
The letter also outlines serious concerns about the downstream effects on hospitals, physicians and patients. Hospitals are unlikely to absorb the 10% payment cut, potentially passing those costs to physicians or pressuring them to join networks under unfavorable terms. This could accelerate consolidation, pushing more physicians into hospital employment and threatening the viability of independent practices.
The letter also warns that the policy could delay care, particularly in rural and underserved communities, where hospitals depend on a mix of participating and nonparticipating specialists to maintain coverage. Rather than implementing “a policy with so many negative consequences,” the letter urges Anthem to instead adopt policies that promote fair contracting, reduce administrative burdens and ensure robust networks for patients.
CMA will continue to monitor developments and advocate for physician practices and patient access to care in California.