Blue Cross Opts Out of PPOs: A Concept That Might Help Fix the Damage

Blue Cross Opts Out of
PPOs: A Concept That Might Help Fix the Damage

By

Leonard Zwelling

http://www.houstonchronicle.com/business/medical/article/Loss-of-insurance-plans-could-devastate-cancer-6603232.php

         The front page of the Houston
Chronicle
on Sunday, November 1, describes the fact that cancer patients
formerly covered by BC/BS PPO insurance will no longer be welcomed at MD
Anderson. This is not a direct result of anything MD Anderson has done and is
not exclusively an MD Anderson problem, although the headline would lead you to
believe otherwise. The leaders of the UT Cancer Center did not wake up one day
and decide to make life hard for a subset of patients covered by one type of
insurance (the story suggests this will affect about 2000 current MD Anderson
patients). This is a result of two great forces clashing over the heads of
individuals with serious diseases.

         The first is the ACA, the exchanges and the fact that the
law invited coverage (in fact mandated it) for many who could not get coverage
before. They tended to be sicker and thus, in the early years of full-fledged
ObamaCare, the insurers misunderestimated the cost of these patients and
misoverestimated the amount their premiums would bring in. This is made clear
in the Chronicle article as there appears to be $400 million in losses to local
insurers. So, as more sick people came in, cost to insurers went up and only
now are the insurers trying to recoup their losses with higher premiums for us
all. Thanks Barack. Supply and demand can be a bitch.

         The second is that indeed MD Anderson, and all the rest of
the premium providers in the Texas Medical Center do cost too much because
their prices have to reflect their fixed costs of overbuilding, over hiring, and
under efficient care provision. (I am now convinced the EMRs help no one except
those using them for billing purposes).

http://www.nejm.org/doi/full/10.1056/NEJMp1509961

         To review: too many sick people, too many bills, too much
cost leads to the spigot being turned off by the insurers who seem to be the
only ones with any discipline. Perhaps if the large hospitals had real
shareholders they too might exercise some vigilance when it comes to costs.

         As sad as this is for those with cancer who lost their
coverage and perhaps access to MD Anderson, this was totally predictable to any
one. There simply is not enough money in the system to sate the desire of the
warlord Presidents of the TMC organizations to build without cooperating with
each other (do we really need two children’s cancer programs in Houston?), but that
fact does not obligate the insurers to pick up the slack. They will not.

         So here’s a concept. Rather than worry about commercializing
the latest genetic test or medical device as a scheme to make money, perhaps
the leaders of the TMC organizations could sit around the table and weed out
the redundancies in their programs, downsize their administrative staffs, and
reduce their costs the old fashioned way by spending less.

         Hey, it’s just a thought, but I really do not think Houston
needs cancer programs at MD Anderson, Methodist, Hermann, TCH, Kelsey-Seybold
and St. Luke’s. Perhaps we should consider using the proton center only for
patients with cancers that actually have demonstrated response to this form of
therapy and stop with the prostate cancer patients for which this form of
radiation has yet to be shown to be superior to IMRT. Perhaps if the TMC’s
leaders put patients first instead of money and their jobs, BC/BS could afford
to return to making a PPO product available to Houstonians. Or better yet,
let’s ditch the insurance companies and have a single payer plan like we do for
those over 65.

         Talk about a concept!

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