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Profile: BlueCross Blue Shield (BCBS)

BlueCross Blue Shield (BCBS) was a participant or observer in the following events:

BlueCross BlueShield logo.BlueCross BlueShield logo. [Source: TopNews (.us)]Health insurers have mobilized tens of thousands of employees to fight against the Democrats’ health care reform initiative, according to reports by the Los Angeles Times and the Wall Street Journal. The insurance industry’s primary motive seems to be financial gain, according to the Times reporters. Many of the nation’s largest insurers, including UnitedHealth, have urged their employees to become involved in protesting health care reform, and provided advocacy “hot line” telephone numbers, printed “talking points,” sample “letters to the editor,” and other materials in almost every Congressional district throughout the nation. And many insurers, including BlueCross Blue Shield, have sponsored anti-reform television ads targeting conservative “Blue Dog” Democrats, many of whom are considered vulnerable to pressure from the industry. The insurance industry is paying for over 900 lobbyists, spending $35 million in the first half of 2009 lobbying Congress and the White House. AFL-CIO spokesman Gerald Shea says: “They have beaten us six ways to Sunday. Any time we want to make a small change to provide cost relief, they find a way to make it more profitable.” [Los Angeles Times, 8/24/2009; Wall Street Journal, 8/24/2009]
Jamming the 'Town Halls' - Insurers like UnitedHealth and others are sending their employees to “town hall” meetings to protest against reform. The Journal reports, “[T]he industry employees come armed with talking points about the need for bipartisan legislation and the unintended consequences of a government-run health plan to compete with private insurers.” But they are instructed not to become contentious and argumentative, according to a “Town Hall Tips” memo provided by the industry’s chief lobbying organization, America’s Health Insurance Plans (AHIP—see Before August 6, 2009). The memo warns those attending the meetings to expect criticism, and to stay calm. “It is important not to take the bait,” the memo cautions. AHIP president Karen Ignagni says the town hall meetings are an opportunity “to strongly push back against charges that we have very high profits. It’s very important that our men and women… calmly provide the facts and for members of Congress to hear what these people do every day.” Larry Loew, who works for the insurance administration firm Cornerstone Group, says he attended a recent town hall meeting hosted by Representative Alan Mollohan (D-WV) because “my whole industry is being threatened.” Loew claims he was not coached by AHIP, but admits to preparing for the meeting by gathering talking points from hospital and insurance company Web sites. AHIP spokesman Robert Zirkelbach says about 50,000 employees have been engaged in writing letters and making phone calls to politicians or attending town hall meetings. [Wall Street Journal, 8/24/2009]
'Hallelujah!' - One industry proposal that is gaining traction among some in Congress is the so-called “individual mandate,” which would require all citizens to buy some form of health insurance. That provision would guarantee insurers tens of millions of new customers—many of which would receive government subsidies to help pay the premiums. Robert Laszewski, a former health insurance executive who now heads the consulting firm Health Policy and Strategy Associates, says of the provision, “It’s a bonanza.” The industry’s reaction to early negotiations can, Laszewski says, be summed up in a single word: “Hallelujah!” Linda Blumberg, a health policy analyst at the nonpartisan Urban Institute, says, “The insurers are going to do quite well” with health care reform. “They are going to have this very stable pool, they’re going to have people getting subsidies to help them buy coverage, and… they will be paid the full costs of the benefits that they provide—plus their administrative costs.” Aetna’s chief executive, Ron Williams, says: “We have to get everyone into the insurance market. That is a huge, big deal [and] everyone has coalesced around that.” [Los Angeles Times, 8/24/2009; Wall Street Journal, 8/24/2009]
Battling the Public Option, - Insurers have fought most strongly against the so-called “public option,” which would create a government-run, non-profit alternative to private health insurance. Some polls are showing public support for the public option has declined, and stock prices for the insurance corporations have tracked upwards. Other insurance industry proposals are gaining ground. The Senate Finance Committee is considering a proposal to lower the proposed mandatory reimbursement rate for insurers to policyholders from 76 percent to 65 percent, and the industry is pressuring Congress to lower the limit that insurers must meet to cover a policyholder’s medical bills, leaving more of the money it gleans from premiums as profits. “These are a bad deal for consumers,” says J. Robert Hunter, a former Texas insurance commissioner who works with the Consumer Federation of America. Insurance companies would reap huge profits by providing less insurance “per premium dollar,” he says. Former Cigna executive Wendell Potter says, “It would be quite a windfall” for the insurance industry. [Los Angeles Times, 8/24/2009]

Entity Tags: Consumer Federation of America, UnitedHealth Group, Urban Institute, Wall Street Journal, BlueCross Blue Shield, Alan Mollohan, Senate Finance Committee, AFL-CIO, Aetna, America’s Health Insurance Plans, Wendell Potter, Robert Laszewski, Health Policy and Strategy Associates, Gerald Shea, Cornerstone Group, J. Robert Hunter, Robert Zirkelbach, Ron Williams, Linda Blumberg, Karen Ignagni, Larry Loew, Los Angeles Times

Timeline Tags: US Health Care

Health insurance corporations defend their use of “rescissions,” or denials of care due to what they term “pre-existing conditions” among their customers. Washington Post reporters interview Los Angeles businesswoman Sally Marrari, who in 2006 had her coverage canceled by Blue Cross & Blue Shield after the firm claimed she had withheld information from them about a back problem. Marrari was undergoing treatment for a thyroid disorder, a heart problem, and lupus. After her coverage was canceled, Marrari was diagnosed with pancreatic cancer, and quickly racked up over $200,000 in medical bills. She says she had no idea at the time that she had any back issues. She is currently suing the company, and is getting health care by trading office visits for work on her doctor’s 1969 Porsche at the garage she owns with her husband. Marrari’s tale is one of many cited by the Post as illustrative of the insurance industry’s unpopular practice. The Post writes, “Tales of cancellations have fueled outrage among regulators, analysts, doctors, and, not least, plaintiffs’ lawyers, who describe insurers as too eager to shed patients to widen profits.” Insurance company spokespersons claim to have little knowledge of just how and why particular patients are subjected to rescission, and Congressional investigators point to a patchwork of state laws and policies which lead to confusion. Since 2008, California’s five largest insurers have paid almost $19 million in fines for unfairly canceling policyholders’ insurance after those clients filed claims. One insurer, Health Net, has admitted to offering bonuses to employees for finding reasons to cancel policies. Gerald Kominski of the Center for Health Policy says: “This is probably the most egregious of examples of health insurers using their power and their resources to deny benefits to people who are most in need of care. It’s really a horrendous activity on the part of the insurers.” But insurers say the rescissions are necessary to combat fraud among policyholders. An Anthem Blue Cross spokeswoman says: “We do not rescind a policyholder’s coverage because someone on the policy gets sick. We have put in place a thorough process with multiple steps to ensure that we are as fair and as accurate as we can be in making these difficult decisions.” Blue Cross has been fined $11 million over the last two years by California state overseers, and required to reinstate dozens of canceled policies. Officials from three insurance companies recently told a House Energy and Commerce subcommittee they had saved $300 million by canceling about 20,000 policies over five years. [Washington Post, 9/8/2009]

Entity Tags: BlueCross Blue Shield, Anthem Blue Cross & Blue Shield, Sally Marrari, Gerald Kominski, Health Net

Timeline Tags: US Health Care

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