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August 21, 2009

Frequently Asked Questions About National Health Care Reform
Over the next several weeks, the TV and radio airwaves will be flooded with ads from interest groups trying to influence public opinion on health care reform. During this time, there will be misinformation swirling around in the media. This article is meant to help you understand the issues at hand and Blue Cross Blue Shield of Massachusetts' position on national health care reform.

Q: President Obama recently unveiled eight consumer protections that he says are necessary to protect consumers from the practices of health plans. What does Blue Cross Blue Shield of Massachusetts think about this?
A: First, it's important to note that the health insurance industry has already agreed to end the practices to which the president is referring. (See America's Health Insurance Plans' press release, "AHIP Proposal Includes Guarantee Issue, Rating Reform, and Coverage Requirement.") Second, most, if not all, of the insurance reforms the president is speaking about already exist in Massachusetts. For example, no health plan in Massachusetts can refuse to enroll a member based on a pre-existing health condition. And lastly, without more specifics, it's hard to say whether Massachusetts will be fully compliant with the president's consumer protections for "annual caps on out-of-pocket expenses, deductibles or co-pays," "no annual or lifetime caps on coverage," and "no cost-sharing for preventive care." These protections are defined by minimum creditable coverage (MCC) requirement in Massachusetts, which does include some cost-sharing on preventive care services and other limits.

Q: Does Blue Cross Blue Shield of Massachusetts support national health care reform?
A: Absolutely, yes. And we believe the 2006 Massachusetts health care reform law should serve as an important model. Also, the Massachusetts law focused on expanding coverage to the uninsured but did not adequately address the rising cost of health care. As you know, the state has since begun taking steps to slow rising costs, including the recent recommendations by the state's payment reform commission to reform the way we pay for health care. We believe it's imperative for any meaningful national health care reform to address both expanded coverage and cost containment.

Q: What does Blue Cross Blue Shield of Massachusetts think about a so-called "government option" that would have a government health plan compete with private health insurers?
A: We oppose a government option because we do not believe it is necessary. Massachusetts has been able to cover 97.5 percent of Massachusetts residents without a government plan. We are also very concerned that the government would underpay providers who would seek to recapture losses on public coverage from private insurers. This cost-shift trend already exists in Medicare and Medicaid today and would only be exacerbated by the introduction of a government option. Additionally, the government is often slow to innovate and implement changes due to the complex legislative and regulatory process. On the other hand, the private sector is free to innovate and has initiated programs to improve quality of care and slow rising costs, such as recognizing medical centers of excellence and promoting quality through provider incentives.

We also believe that a government health plan would have an unfair competitive advantage because it wouldn't necessarily be required to do all of the things private health plans have to do, such as:

• Comply with state mandates
• Make a margin to fund reserves
• Maintain sufficient reserves
• Potentially be able to negotiate lower rates with providers, which would lead to more cost-shifting to the private sector resulting in higher premiums

Q: What does Blue Cross Blue Shield of Massachusetts most want to see included in national health care reform legislation?
A: We believe that any meaningful reform legislation must address the waste and ineffectiveness in the health care delivery system. Study after study documents that as much as 30 percent of all health care spending is unnecessary and potentially harmful to patients. These studies also suggest that eliminating the overuse, underuse, and misuse of health care services will reduce harm and lower costs. In fact, eliminating the unwanted variation in clinical care could save $690 billion a year.

We believe the most effective way to improve the delivery system is to change the way we pay for health care. In Massachusetts, we are already moving away from the current fee-for-service system that rewards the quantity, not quality, of care. We believe a system of global payments with outcome-oriented incentives will both improve quality and slow rising costs. As the nation expands coverage, its progress toward affordable, high-quality care would be greatly advanced if Medicare embraced a global payment system, like our Alternative Quality Contract.

Letter to President Obama
Read the letter that our Chairman, President, and CEO Cleve Killingsworth recently sent to the White House outlining our vision and hopes for national health care reform.

 

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