The Transylvania Times -

County Hears Possible Insurance Impact

 

September 28, 2017



Unless an agreement is reached before Oct. 5, Mission Health will terminate its contract with Blue Cross Blue Shield (BCBS) of North Carolina.

What that could mean to local residents and county employees was discussed during Monday’s Transylvania Board of Commissioners meeting.

Mark Browder, a broker with Mark III Employee Benefits, gave commissioners a presentation on the possible impacts.

Mark III has been the county’s health insurance broker since 2006.

Transylvania County government offers a self-insured health plan and currently contracts BCBS to administer the benefits for medical and pharmacy services to the county’s employees, retirees and dependents. About 72 percent of individuals in North Carolina are covered by a BCBS health insurance policy.

Browder suspects the matter will be resolved at some point and said Mission and BCBS share the blame for the current situation.

Most county employees will not be impacted because the vast majority of the workforce is not seeking medical help very often, Browder said.

The most frequent medial services sought are pharmaceutical.

In general, Browder said, 1 to 2 percent of the population are driving a third of a health care plan’s costs, while 5 to 10 percent may be driving half of the costs.

Transylvania Regional Hospital, along with the majority of the community’s primary care providers and specialists, are associated with Mission and would, therefore, no longer be in-network if the dispute isn’t resolved.

Mission provides in-patient and outpatient services, emergency room services, and primary care physician and specialty physician services.

The bulk of the nearest physician locations are in Hendersonville.

The contract’s termination will cause “disruption” and will mean having to look for other providers, Browder said.

Beginning Oct. 5

•In-network coverage at Mission Health facilities will only be for emergency care, services that qualify for BCBS’s Continuity of Care (COC) program and care that is not reasonably available at other area facilities.

•In the case of an emergency, a BCBS member should go to the nearest hospital.

Emergency care is always covered as an in-network benefit. Prior authorization is never required for emergency care, unless the individual is admitted.

•If the member meets COC approval based on criteria — acute/chronic/terminal/pregnant in 2nd or 3rd trimester — they are authorized for 90 days, which will pay to their in-network benefits and allow them time to transition to an in-network provider.

•Terminal illness will be extended through end of life and pregnancy cases get longer — 60 days postpartum with their OBGYN and IP delivery if the facility is out-of-network.

•Benefits apply to members’ in-network benefits, but the provider is still considered nonparticipating and is paid at the charge/per fee schedule.

Payment is sent to the member, who must reimburse the provider. (The COC will have to be approved. Then, the claim will be paid as in-network. The member will be responsible for normal in-network charges.)

The key is that COC has to be approved and that they are only approved for 90 days to allow the member to transition to an in-network provider.

Most BCBS plans allow customers to receive covered services from out-of-network providers.

However, customers typically must pay higher out-of-pocket costs for out-of-network care.

Under the Co-Pay Plan

•An individual, for example, in-network would have a deducible of $1,500, while out-of-network the deductible would be $4,500. A family would have a deductible of $3,000 in-network and $9,000 out-of-network.

•The out-of-pocket limit would be $3,500 for an individual in-network and $8,500 for out-of-network.

For a family in-network it would be $9,000 and out-of-network it would be $21,000.

The “real kicker,” Browder said, is there is no “cross application.”

It could mean satisfying the $1,500 deductible and then facing a $4,500 deductible for out-of-network for a total of $6,000.

Browder said it was important to be “cautious” and look at all the options.

Under the Deductible Plan

•An individual, for example, in-network would have a deducible of $1,000, while out-of-network the deductible would be $2,000.

A family would have a deductible of $3,000 in network and $6,000 out-of-network.

•The out-of-pocket limit would be $3,000 for an individual in-network and $6,000 for out-of-network.

For a family in-network it would be $9,000 and out-of-network it would be $18,000.

Commission Chairman Larry Chapman asked if the county could seek to go to another insurance carrier.

Browder said the county has a contract with BCBS through June 30, 2018, and suggested it wouldn’t be easy.

Browder characterized the current stalemate between Mission and BCBS as an “economic dispute,” primarily to do with reimbursements to Mission.

Based on Mission Hospital’s cost structure, it has expressed its need for annual increases in its reimbursement arrangement with BCBS and other payers, he said.

Any increase in reimbursements to Mission Hospital negatively impacts Transylvania County’s medical plan costs.

In its negotiations with Mission Hospital, on behalf of Transylvania County and other large employers, BCBS, Browder said, is trying to pause the annual increases that Mission Hospital expects, in an attempt to positively impact its clients’ medical trends.

In the past three years, county medical and pharmacy costs have gone up at a low double-digit rate — 11 to 14 percent per year.

Those increased costs are passed on to customers’ health plans.

Browder said there has been a change in the health care cost environment the past three to four years.

Hospitals used to terminate a contract with an insurer and then the negotiations would start, he said.

The business model has historically been about paying a fee for service.

Recent health care reform efforts have changed this to a performance-based/outcome based model, where providers get paid for the performance on the health of a population.

The challenge, Browder said, is that “some entities don’t want to go that route.”

 
 

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