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N.C. BCBS denounces Feds over risk-corridor payments


Blue Cross and Blue Shield of North Carolina has denounced the federal government  for trying to avoid paying it  many millions of dollars in overdue risk-corridor payments.

Modern Healthcare reported: “Although the U.S. Justice Department recently said the insurer’s lawsuit and several others over the controversial three-year program are premature, since payments allegedly won’t be due until next year at the earliest, the North Carolina Blues said that argument runs afoul of the Affordable Care Act and history of the risk-corridor program.”

The insurer attacked the Feds’ recent  moves in a series of lawsuits over risk-corridor payments for 2014 and 2015. North Carolina BCBS alone is owed $147.5 million in overdue payments for its losses  on the Affordable Care Act exchange but so far, the Feds have only paid the insurer $18 million.

The Blues say the risk-corridor program was a major element in the insurer joining the insurance exchange in the state, as it hedged the impact of insuring new customers without necessary medical or actuarial data to help set premium rates. The Feds have touted the program over the years as a way to protect health plans.

Modern Healthcare reported that the Justice Department has asserted that the risk-corridor plan was meant to be budget-neutral, which BCBS disputes, pointing out that  the final rulemaking establishing the risk-corridor program stated  that the program was not going to be budget-neutral.

To read the Modern Healthcare article on this, please hit this link.

N.C. Blues might quit ACA marketplace


The (Raleigh, N.C.) News & Observer reports that Blue Cross and Blue Shield of North Carolina, following some other big insurers, might consider leaving the Affordable Care Act  (ACA) marketplace in 2017 because of heavy losses.

The insurer estimates that it  lost more than $400 million on its ACA policies for 2014 and 2015. Even though BCBSNC raised its rates 32.5 percent this year, CEO Brad Wilson said, that still couldn’t keep the insurer from losing money on its exchange products, the  paper reported.

So BCBSNC might decide later this year whether it would be wisest to stop selling ACA policies. “We can’t offer something for sale in this marketplace that we know every time it’s purchased we’re losing money,” Mr. Wilson said during a meeting with the newspaper’s editorial board and editors.

If BCBSNC pulls out of the marketplace in 2017, more than 300,000 people would need  new coverage, the  paper noted. North Carolina Insurance Commissioner Wayne Goodwin told the newspaper that BCBSNC will decide on its strategy based on the rate increase that his agency approves for next year.



N.C. physicians push for more price transparency


A look at why and how Blue Cross and Blue Shield of North Carolina launched a Web site that lets consumers find the average out-of-pocket cost of many medical procedures. The move was partly instigated by a state transparency law.

The online  database was made available to the general public in January.  Modern Healthcare says that “It covers 1,200 nonemergency procedures, showing the average total of how much the insurer pays particular providers for an episode of care. The figure is drawn from the insurer’s claims data and includes all costs—the discounted payment, physician fees, facility fees, drug and medical supply costs, as well as consumers’ cost-sharing.”

(But what about many emergency procedures?)

The new service  drew criticism  from some high-cost providers and  some consumer advocates, who said the pricing data weren’t adequately explained.So Blue Cross  hopes to improve the tool by “offering additional data on utilization and outcomes patterns for particular providers because price alone doesn’t reveal whether a provider delivers value, ” says Modern Healthcare.

The most interesting part of the tale is that physicians have been among those pushing for more transparency because, as the publication noted, “it would help them as they enter value-based contracts. Internists, for instance, could use the price information to change their referral patterns by looking for high-quality labs or physician specialists offering lower costs.”

More systems eye entering insurance business



In western North Carolina’s mountains.
One large health system in North Carolina is ready to launch a Medicare Advantage plan, and two others  in the Tar Heel state are mulling the pros and cons of becoming a payer. Cone Health, a $1.4 billion health system in Greensboro,  has received a state license to sell health insurance, and it’s in the process of receiving approval from the the Centers for Medicare and Medicaid Services to offer Medicare Advantage plans to seniors.

Modern Healthcare reports that “Health systems are increasingly jumping into the insurance space. Even though costly information technology and complicated actuarial predictions are large hurdles, organizations view health plans as the missing piece to the population health puzzle. If people in a hospital system’s service area are willing to go to those providers for care, why not offer the coverage to pay for it and keep the healthcare dollar local?””Cone Health runs a Medicare Accountable Care Organization called Triad Healthcare Network, which earned more than $10.5 million in shared savings in its first year. The early success of that ACO gave executives confidence that they could move to the more aggressive, capitated Medicare Advantage structure, in which the federal government pays private insurers lump sums for each member.”

Meanwhile, Mission Health, a $1.4 billion hospital network based in Asheville, is looking into entering the insurance business, though so far anyway,  the  system would prefer to build partnerships with established insurors rather than get into the business directly.

And Charlotte-based Carolinas HealthCare System, the largest system in the state, with almost $5 billion in annual revenue (PDF), also has no immediate plans to build a commercial insurance business.

But, Modern Healthcare reports, “Carolinas is changing how it works with insurers. The system was the first in the state to create a narrow-network product with Blue Cross and Blue Shield of North Carolina, the state’s dominant insurer. Carolinas is also participating in bundled payment programs with local employers, where Carolinas receives a fixed amount of money for certain cardiovascular procedures.”

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