Blue Cross Blue Shield of Massachusetts Annual Report 2006

President and CEO's Letter

Just as the Commonwealth of Massachusetts is a global leader in medicine, life-science, and bio-technology, our health plans are models for excellence. The National Committee for Quality Assurance ranks three Massachusetts health plans — Blue Cross Blue Shield of Massachusetts, Harvard Pilgrim Health Care, and Tufts Health Plan — among the top five in the United States. At Blue Cross Blue Shield of Massachusetts, we are proud to be one of the nation's best.

Our comprehensive product portfolio, outstanding service, effective care-management programs, and easy-to-use web-based tools provide employers and members with a wide range of options to meet their needs. Our business discipline ensures that we return 90 cents of every dollar to our members in the form of payments for health care. We dedicate 10 cents of each dollar to administrative expenses, reserves, and investments that benefit the entire community. Solid finances and a trusted position in the community enable us to collaborate with the finest doctors, nurses, hospital executives, academic institutions, advocates, and business leaders in the pursuit of health care excellence.

Precisely because Massachusetts is home to world-class hospitals, groundbreaking research, and some of the most talented and dedicated health care professionals anywhere, we have a special responsibility — and opportunity — to make sure that our health care is as safe and effective as possible. The existing health care delivery system, however, simply was not designed to produce the quality of care that patients and clinicians have come to expect. Medical leaders estimate that patients receive recommended care only 56 percent of the time.[1]Elizabeth A. McGlynn et al., "The Quality of Health Care Delivered to Adults in the United States." The New England Journal of Medicine, (June 26, 2003): 2635-2645. Studies continue to show that the overuse, misuse, and underuse of valuable health care resources jeopardize quality and increase costs. In response, we are committed to partnering with individuals and institutions across the state to transform health care.

As part of this commitment, the Massachusetts eHealth Collaborative, which we help fund, is launching fully integrated electronic health records with medical decision support in three Massachusetts communities. This pioneering initiative is attracting national attention.

Together with trusted organizations such as the Massachusetts Coalition for the Prevention of Medical Errors, Masspro, and Massachusetts Health Quality Partners, we are striving to provide better health services in our communities. Our shared vision is of a Massachusetts in which everyone will consistently receive patient-centered, evidence-based medical care.

To recognize organizations that have demonstrated exceptional achievement in improving the quality and safety of care in Massachusetts, we established and funded The Health Care Excellence Award. Each year, a panel of nationally recognized health care leaders will review applications and present the winner with $100,000.

The new health care reform law presents an extraordinary opportunity for Massachusetts to become the first state in the nation to achieve near universal coverage for its residents. We are well on the way. Since the law passed, the advocacy group Health Care for All reports that more than 100,000 previously uninsured residents are now insured. A testament to the power of collaboration, the legislation is the result of immense hard work, determination, and commitment from political, business, and civic leaders across our Commonwealth. Blue Cross Blue Shield of Massachusetts remains more committed than ever to the successful implementation of this historic law.

Since our founding 70 years ago, our mission has been to serve our members and the community. It is both a responsibility and a privilege to work with leaders across the Commonwealth to transform the health care delivery system so that excellence becomes the standard. Our efforts demonstrate how we strive to keep our corporate promise "to always put our members' health first."

Cleve L. Killingsworth
President and Chief Executive Officer