Sentara Health and Anthem Ended Contract Negotiations

The health system will become out-of-network for several insurance plans starting in January.

Updated on Oct. 5, 2026 in Healthcare

Isometric editorial illustration of a monolithic medical administrative building, representing the structural shift in regional health insurance network access. — Sentara Health has terminated its contract with Anthem Blue Cross Blue Shield, moving several insurance plans to out-of-network status effective in January. AI Illustration. Upload story photo >

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Sentara Health has ended contract negotiations with Anthem Blue Cross Blue Shield after failing to reach an agreement on reimbursement rates. Consequently, Medicare Advantage, Medicaid, and ACA Exchange plans will transition to out-of-network status beginning in January 2027.

Why it matters

The dispute centers on financial disagreements regarding reimbursement increases and alleged unpaid debts. Sentara Health stated that the termination is necessary because it can no longer absorb insurance underpayments.

Sentara Health alleges Anthem owes $105 million for past care, $27 million from a 2025 settlement, and $49.7 million from downgraded emergency visits. Anthem maintains that Sentara requested a 30% price increase.

The players

Sentara Health

This is a Virginia-based non-profit health system that operates multiple hospitals and medical centers throughout the region.

Anthem Blue Cross Blue Shield

This is a major health insurance provider that manages various Medicare, Medicaid, and private insurance plans for residents.

The details

Sentara Health terminated its contract with the insurer in July following a failure to agree on new reimbursement terms. The provider remains in-network for commercial employer-sponsored plans and all other members through the end of the year.

Sentara Health initially terminated its contract on July 31, 2026.
A letter setting the October 1, 2026, deadline was sent on September 23, 2026.
The deadline for Anthem to accept the proposal passed on October 1, 2026.
In-network access for affected members concludes on December 31, 2026.
Out-of-network status becomes effective on January 1, 2027.

Market Landscape

This split reflects a broader trend of escalating tensions between large health systems and major insurers over reimbursement structures. It highlights the increasingly fragile nature of provider networks as both parties attempt to navigate rising operational costs.

Patients enrolled in Medicare Advantage, Medicaid, or ACA Exchange plans will need to find in-network providers or face higher out-of-network costs after December 31. Those with commercial employer-sponsored plans are currently unaffected by this change.

The takeaway

Patients should review their current insurance documents to determine if their specific plan is affected by the network change. Consulting with a benefits administrator can help clarify how to maintain continuity of care for upcoming appointments.