CQ: Blue Cross Blue Shield Rolls Out $300 Billion Plan for Health Savings

CQ HEALTHBEAT NEWS
Oct. 4, 2011 – 3:36 p.m.

Blue Cross Blue Shield Rolls Out $300 Billion Plan for Health Savings

By Jane Norman, CQ HealthBeat Associate Editor

The Blue Cross and Blue Shield Association on Tuesday unveiled a list of proposals that the insurer says would save the federal government more than $300 billion over 10 years in health care costs.

The recommendations come at a time of increasing worry over rising health care costs, and as a supercommittee of lawmakers charged with achieving deficit reduction is closely scrutinizing federal entitlement spending.

Insurance companies like Blue Cross and Blue Shield are on the line, too, in light of reports of escalating health insurance premiums that are putting a strain on both businesses and families. The association is made up of 39 independent and locally operated Blue Cross and Blue Shield companies that provide health insurance coverage for 99 million enrollees.

Blue Cross officials said their plan looks beyond immediate cost cutting and toward a more efficient and high-quality system over the long term. They urged that Medicare move beyond pilot projects and demonstration programs and into a system that departs from traditional fee-for-service medicine.

“It really is a call to action,” said Scott P. Serota, president and CEO, noting that health care expenditures now account for more than 17 percent of the gross domestic product.

He said that company officials will be talking with members of Congress and the Obama administration about their ideas. Some of them would require legislation while others could be done administratively by the Centers for Medicare and Medicaid Services (CMS). But even when the supercommittee’s work is concluded, “we will continue to push ahead,” said Serota.

Four Categories

The ideas, many derived from successful local Blue Cross operations, include an expansion of a bundled-payment pilot program into a permanent system; enrollment of dual eligibles into better care coordination; stepped-up prevention initiatives focused on diabetes and obesity; and an overhaul of the medical liability system.

In general, the proposals can be divided into the categories of rewarding safety, doing what works, reinforcing front-line care and promoting healthy living.

A paper prepared for the association by Kenneth Thorpe, an Emory University professor and health policy expert, detailed the savings based in part on Congressional Budget Office (CBO) projections and on other research. Thorpe, a former HHS official in the Clinton administration, said he is particularly interested in seeing CMS move more quickly toward a changed Medicare system rather than continuing to test out smaller-scale pilot programs. “For me, personally, I have a pilot fatigue issue,” he said. “We don’t need any more pilots.”

Thorpe said that:

· Accelerating the adoption of new high-priority safety measures in the hospital value-based purchasing program would save $3 billion over 10 years. The health law (PL 111-148, PL 111-152) established the program which provides incentive payments to hospitals based on performance standards.

· Expanding the bundled-payment initiative from a pilot to cover all inpatient Medicare discharges by 2020 would save $21 billion over 10 years.

· Enrolling dual eligibles into plans that use evidence-based coordination of care would save $125 billion or more over 10 years depending on the approach. In addition, coordination of care could be made available to all fee-for-service Medicare beneficiaries over the next three years at a net savings of $105 billion. Traditional Medicare now has no care coordination for any patients other than those who are homebound, Thorpe says.

· Adopting national evidence-based lifestyle change programs, including diabetes prevention, would save $7 billion over 10 years.

· Creating a childhood obesity prevention program for Medicaid and Children’s Health Insurance Program recipients would save $3 billion over 10 years.

· Adopting a Medicare Payment Advisory Commission recommendation for pre-authorization of advanced imaging services in Medicare for certain outlier physicians would save $1 billion over 10 years.

· Overhauling the medical malpractice system to include caps on non-economic and punitive damages and a shorter statute of limitations would save $54 billion over 10 years.

Blue Cross Blue Shield Plan (pdf)

Source: CQ Online News

Same-day coverage of the people and events shaping health care policy from Washington.

© 2011 CQ Roll Call All Rights Reserved.

Kevin Wrege, Esq.

Founder & President

Pulse Issues & Advocacy LLC

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