The Transylvania Times -

Guest Column: For BCBS, How Much Money Is Enough?

 

September 11, 2017



A barrage of negative advertising and misleading claims from Blue Cross and Blue Shield of North Carolina (BCBSNC) have generated a common question: “How much is enough?” Since reporting more than half a billion dollars of profit ($542 million) for the first six months of 2017 – that important question has new and very profound meaning.

Let’s put BCBSNC’s extraordinary profits into context: it would take Mission more than 15 years to earn what BCBSNC did in just six months. If Mission accepted BCBSNC’s below zero or “forever zero” contract offers, we would be devastated – slowly, but surely over the coming years.

But with just over 3 percent of its last six months profit, BCBSNC could cover Mission’s requested payment increase and support quality health care for our one million residents – and no rate increase for any consumer or employer; alternatively, it could use that profit to cover Mission’s requested payment increase for more than 25 years.

My repeated requests to even discuss a contract have always been immediately rejected. With no one to speak with, I’ve publicly offered two solutions: 1) Mission would accept a one year 0 percent rate increase if Blue Cross did likewise for its customers; and 2) Mission would accept – without even knowing the number – the same rate of increase BCBSNC extracted from Western North Carolina employers.

Silence.

BCBSNC even refused when Mission succumbed to its demand for no increase for Obamacare exchange members who can only choose BCBSNC.

Unconscionable.

While BCBSNC’s focus may be on profit, control and power, Mission’s focus is survival. Although healthy today, our financial foundation is remarkably fragile. BCBSNC dominates the insurance market with 72 percent share, so it literally controls Mission’s financial destiny.

I understand that some see Mission as “a big, deep-pocketed organization like BCBSNC.” Perhaps that’s driven by Asheville’s new $400 million tower construction - a big project that does cost a lot of money. But it is simply a bed-for-bed St. Joseph’s Hospital replacement. Partially constructed in the 1950s, St. Joseph’s will soon no longer support good patient care. When buying a home, you take out a loan, work hard and repay it over decades; Mission is doing the same. Mission is large relative to our region, but BCBSNC is a truly enormous company; no valid size comparison exists except perhaps David and Goliath.

Despite our challenges, Mission Health and BCBSNC have had a good relationship for many years, working together to provide exceptional care to Western North Carolina residents. Yet the numbers make it obvious that Mission’s financial needs are nearly insignificant for BCBSNC. And Mission has done its part. We are the only entity in North Carolina ever rated a top 15 health system, and we’ve received that recognition in five of the past six years. And we’ve continually reduced our costs - $240 million between 2012 and 2018; nearly $70 million this year alone. Cost reductions are essential for Mission’s financial stability, but so are fair payments from BCBSNC.

Despite our cuts, costs rise for drugs, medical supplies and technology – all entirely out of Mission’s control. One example is a new breakthrough leukemia drug, just approved for $475,000 per dose.

BCBSNC’s failure to acknowledge Mission’s inflation reveals its focus on profit, control and power. It routinely threatens to abuse that power by ignoring patients’ choices to send insurance payments to medical providers and instead send checks only to patients. This practice, already illegal in the majority of states, is designed solely to create harm to Mission while leaving vulnerable patients responsible for managing complex, impossible to decipher insurance forms. All of this from a company that was recently fined the largest ever amount by the North Carolina Department of Insurance because it couldn’t pay its claims or even specify who was insured.

So how much is enough? How many hundreds of millions of dollars – taken directly from businesses and consumers like you to pay doctors and health systems like Mission for your care – will BCBSNC use to maintain market dominance, intimidate health care providers and disparage Mission? Mission won’t join BCBSNC in its advertising war gutter because it is unethical; we use the money we receive to care for you.

Everyone in Western North Carolina — not just BCBSNC’s customers — needs Mission and BCBSNC to work together. Mission needs your support to ask BCBSNC to break its nonsensical vow of silence, focus on the people of Western North Carolina and talk to Mission about a contract. As long as the issue remains BCBSNC’s profit, control and power, we all lose; but if we focus on improving health and managing costs effectively together, we all win.

We can only hope BCBSNC’s board – and its new CEO who begins Oct. 1 – know how much really is enough.

(Ronald A. Paulus, M.D., is president and CEO of Mission Health.) 

 
 

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