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Blue Cross Blue Shield of Massachusetts Shares Position on National Health Reform

CONTACT: Tara Murray
(617) 246-4851
Tara.Murray@bcbsma.com

BOSTON — March 26, 2010 — The passage of national health reform is an historic moment. The nation is following the trail blazed here in Massachusetts in expanding health insurance coverage to the uninsured. Blue Cross Blue Shield of Massachusetts and the Blue Cross Blue Shield of Massachusetts Foundation have a long history of supporting public efforts to expand access to care here in the Commonwealth. We are also pleased that the same consumer protections that have been in place in Massachusetts for many years, such as guaranteed health insurance coverage for patients with pre-existing conditions, will now be granted to residents of other states.

With the law now signed, the focus must turn to the hard work of containing rising health care costs. As we have learned here in Massachusetts, expanded coverage will only be sustainable if meaningful steps are taken to address the underlying costs of providing medical care. For Blue Cross Blue Shield of Massachusetts, these costs account for approximately 90 percent of the premiums our members and customers pay. We believe the most significant step our state and the nation could take to address rising costs is to change the way the government and private health plans pay for health care services. In this regard, we are hopeful that Massachusetts can again be a model for the rest of the nation in leading efforts to move away from the wasteful and inefficient fee-for-service payment system and toward a system of global payments with quality incentives. We believe such a system will both improve quality and lower costs.

As we have maintained throughout the lengthy national debate, there are worrisome provisions in the new law including new taxes on health plans that will increase health care costs for many people. We will work with government and others to address these costs, as well as unforeseen issues that will inevitably occur as the nation begins to implement these major changes.

Under the new federal law, Massachusetts is expected to receive as much as $2 billion in additional Medicaid funding over the next decade. We are hopeful these additional funds can be used to offset the impact of the law's new taxes while addressing the serious problem of cost shifting from public payers like Medicaid to private payers like Blue Cross Blue Shield of Massachusetts. This cost shifting, or underpayment to doctors and hospitals by government payers, adds significant costs for private employers and consumers who participate in private health plans.

Given the enormous scope and complexity of the new law, there are many questions still to be answered. We have already begun a detailed review to fully assess the law's impact on our members and employer customers. Once this assessment is complete, we will be begin making any necessary adjustments in our business with the goal of continuing to provide our members and employer customers the highest quality products at the best possible price with the outstanding customer service they have come to expect from Blue Cross Blue Shield of Massachusetts.

Blue Cross Blue Shield of Massachusetts ( http://www.bluecrossma.com ) was founded 73 years ago by a group of community-minded business leaders. Today, headquartered in Boston, BCBSMA provides coverage to more than 3 million members, 2.5 million in Massachusetts. BCBSMA believes in rewarding doctors and hospitals for delivering safe and effective care, and in empowering patients to take more responsibility, become educated health care consumers and become stronger partners with their doctors. Blue Cross Blue Shield of Massachusetts is an independent licensee of the Blue Cross Blue Shield Association.

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