Throughout this prolonged national debate about what to do with our dysfunctional health care system, we here in Florida have heard precious little from or about the state’s dominant private health insurer, Blue Cross Blue Shield of Florida (BCBSF), which covers nearly one out of three insured Floridians.
As this titanic battle appears to be heading towards a congressional climax, it’s all too easy to be swayed by both sides into seeing the Democratic reform effort led by President Obama in overly simplistic terms - good or bad, right or wrong, black or white.
But the painful, confusing realities of how America’s private health insurance system is structured, and who stands to benefit the most from different kinds of changes to that structure - those realities may be more easily understood by looking at what’s happening in the "gray zone", where the Business of health care and the Politics of health care overlap and blur together, where black and white, right and wrong and good and bad can get very hard to tell apart.
That is the murky territory where you’ll find Florida’s largest health insurer trying to stay out of the line of fire and come out on top no matter what - doing its charitable works and playing the part of good corporate citizen, while carefully and covertly playing all sides against the middle when it comes to dealing with the entire issue of health reform, and Florida's vast population of uninsured citizens.
Like the deadly follow-up to Schwarzenegger’s ominous "I’ll be back" line in "The Terminator", the private health insurance industry as a whole has been delivering on its threat to protect revenues by raising premiums - preemptively - to make up for any shortfall that might be caused by reform legislation.
Given the fact that final configuration of any legislation - and the likelihood of its passage - remains uncertain, it’s worth asking how companies like Aetna, Humana, United Health and Blue Cross can determine how much to raise rates in order to keep revenues where they want them in a post-reform world.
But of course, there’s no good answer to that question. Following the public relations firestorm California’s Anthem Blue Cross created recently with its thirty-nine percent rate hike, BCBSF showed its political prowess by requesting far more "modest" increases of over eleven percent for individuals and fourteen-plus- percent for many small businesses.
Note that while Anthem Blue Cross is a for-profit health company owned by rabidly anti-reform industry mammoth, Wellpoint, BCBSF is an independent, not forprofit mutual insurance company - which means it’s owned by policyholders, as opposed to shareholders, and so is expected to take a more...constructive role, shall we say, in the health reform debate.
But for so many struggling families and small businesses already teetering at the precipice, a double-digit rate increase can be enough to shove them right over the cliff and into Florida’s teeming pool of nearly 4-million uninsured men, women and children - well more than one in five of our state’s citizens.
Which, it turns out, is just fine with Blue Cross, for as a 2009 industry report puts it, BCBSF "has continued building its business in the individual market by introducing a series of new products and distribution channels specifically targeting the uninsured", which according to a company spokesman "...are and will increasingly be sold through existing and new retail distribution channels — retail stores, work-site marketing, point-of-sale racks in retail stores (CVS, Winn-Dixie) and others".
Ah, so that’s what BCBSF considers increased access to health care, the opening of retail stores in strip malls, so you can get your iPod and your iNeedHealthCare products all on one handy shopping spree. Isn’t that special? So much easier than those darned federal exchanges the Democrats are trying to enact, with independently regulated but still private, free market competition...and oh, yes...with rate hike controls.
But haven't Fox News and the Republicans and all those TV ads made it clear? That much change would be like a...a government takeover...getting in the way of...of access - access to...to...to BCBSF coverage! Because you see, BCBSF doesn’t have enough customers...
But in reality a recent report indicates that along with a few other insurers, BCBS has achieved "near monopoly" status in Florida.
So you can figure out by now that although they haven't been demonstrably campaigning against it, BCBSF hasn't exactly embraced the Democratic campaign to introduce increased competition and regulation into the industry. Still, they're supposed to be a not-for-profit outfit owned by and run in the best interests of their policyholders. So what to do about reform?
Turns out, they have very quietly released their own "vision of reform" that "cherry picks" the elements of health reform that benefit them most, just as they and other private insurers cherry pick healthier customers and screen out the ones that might actually get sick and need to use their insurance. For instance, BCBSF is just in love with the Democrats' idea of mandated universal coverage, as evidenced by this statement from the "Vision Of Reform" document they sent around to insurance industry hucksters in January: "For those individuals and businesses that do not obtain coverage voluntarily, an enforceable mandate must be created."
Hell, it sure can’t hurt your competitive position to have the government mandate that folks buy a particular product when you’re one of the only companies in town selling it. That was an easy one.
The BCBSF "vision" also focuses on reducing the very health care costs they claim are responsible for their steadily escalating premiums - but only through "reforms" like "Incentives for preventive medicine and wellness...critical changes in medical delivery...efficient, integrated and clinically appropriate care...promoting personal responsibility and good health."
Those are all worthwhile goals that can have some impact on costs in the long run. But the BCBSF "vision" is so narrow and self-interested that it stops there, with those as its only suggested cost control measures. No mention of any reform of the runaway train wreck of an industry that they are a part of. No mention of eliminating their right to refuse coverage to those with preexisting medical conditions. No mention of efforts to make insurance more affordable by lowering premiums or limiting their rate of increase. No mention of cutting costs by reducing their executive perks and compensation (last available reported annual compensation for CEO Robert Lufrano was just under 5-million-dollars). No mention of spending a higher percentage of every incoming premium dollar on actual medical care. And no mention of abolishing the anti-trust exemption that allows them to monopolize the market as they do, with a few other companies.
Yeah, that’s one hell of a "vision of reform", BCBSF.
They even have the audacity to include the following thinly veiled, deceitful scare tactic as part of their "vision": "And if the health care industry doesn’t come together quickly, a declining economy will drive a political agenda that diminishes the positive impact brought by the private sector in terms of innovation and meaningful competition."
Positive impact? Innovation - like BCBSF shopping mall boutiques and drug store kiosks?? Meaningful competition??? I think we've covered that one already.
And who is it anyway that has the real political agenda? A sneaky, hidden agenda, that is. Not the Democrats.
Or to rephrase the question, to what extent has BCBSF been complicit in the now well-documented mega-million-dollar stealth campaign to kill actual reform of the private health insurance industry itself? The industry’s main lobbying and advocacy organization, America’s Health Insurance Plans (AHIP), mapped out a strategy over a year ago to funnel truckloads of cash to the Chamber Of Commerce so it would appear that it was the broader American business community behind the communications campaign that tricked millions into thinking that health reform legislation was some kind of government takeover.
While there’s no smoking gun evidence that BCBSF has been a direct contributor to that campaign, there sure is an awful lot of smoke. BCBSF is a member company of AHIP, listed up near the top of its website's "Health Insurance Plan Links" marketing page. BCBS Chairman and CEO Lufrano is on the AHIP Board of Directors. And of course, BCBSF is a member of the umbrella group, the Blue Cross Blue Shield Association Wouldn’t you know that AHIP & the Association have issued dozens of "joint statements" in recent years, including last Spring’s coordinated attack on President Obama’s health reform efforts.
Reports also indicate that the Association has a Plan B ready, in case the "wrong" kind of reform gets enacted. Their backup plan has to do with getting individual states to declare the new reform legislation unconstitutional- a plan which, what do you know, Florida's extremist Republican Attorney General and gubernatorial candidate, Bill McCollum, has already gone public in supporting and advancing.
And for a little more evidence of who it really is that has a health care "political agenda" in Florida, how about the case of rising star Republican State Senator Mike Haridopolos, who in May, 2009 formed the Freedom First Committee to prove his fund raising capacities; to lock down his hoped for inheritance of the State Senate Presidency from Senator Jeff Atwater; and to help former House Speaker John Thrasher win a special Senate election - in exchange for Thrasher's support of the Haridopolos Senate leadership bid.
Can you guess who the top two contributors to that new Haridopolos political action committee were? The Chamber Of Commerce came in at #1 with $225,000, and yes, BCBSF was #2, with a mere $100,000 contribution. Florida Chamber CEO Mark Wilson proudly said at the time, "...we have an opportunity to make Florida a more pro-business state". BCBSF CEO Lufrano had no comment.
Flash forward to December 2009. Haridopolos was unanimously chosen by his Republican colleagues to become Florida’s next Senate President. And in February, 2010 Senator John Thrasher was elected new chairman of the Florida Republican Party.
The way the world works - especially the intersecting worlds of Big Politics and Big Insurance, especially in Florida - one would presume that BCBSF will get their latest requested rate hike approved. And that they will continue to sit calmly in their catbird seat in that cloudy gray zone - a 300-pound gorilla with a very narrow, self-serving "vision of health reform", waiting to pounce on and benefit from whatever comes next.
We the people of Florida with our terrible uninsured problem, our record unemployment and broken economy, with our housing and foreclosure crises - we owe it to ourselves to see through that veil of gray, to stop listening to all the spin once and for all, and to ask ourselves a simple question: Who stands to benefit the most from Congress forcing the right mix of tough reforms onto the private health insurance industry? Us, that's who. Not the government, not either political party, not BCBSF or any of the other insurance companies. Us.
So with what little time we have left, let's ramp up the telephone calls and emails to Congress and demand that they get this done. This is a simple case of black or white, wrong or right. Let's get it right, Florida.