Blue Cross Committed

by Julia Rosen [courtesy of Working Californians blogs]

To "delivering" their "promises to Wall Street." They expect to continue bringing in a 15% profit. After all, they had a 22% growth rate in the past six years. Those are their priorities, not delivering quality affordable health care. Anthony Wright has direct quotes from the President of Blue Cross's parent company Wellstone, bragging about the profits and the "compelling investment opportunity" they are providing for stockholders. It is rather sickening to read and I am not just saying that because the Sicko premiere is tomorrow.

I assume that the movie will touch on something Anthony discuses and that is the "medical loss ratio".

In this health reform debate, people have been talking about the term "medical loss ratio," which is the term for how much money is spent on patient care, rather than administration, marketing, and profit. It's clearly a Wall Street term: How much money is "lost" to patient care? It shows the inverted priorities of an unrestrained industry.

It suggests that whatever insurance companies (or other companies) say to regulators, it is also important to see what they say to investors.

Speaking of health care costs. The NYT has an illuminating article today on paying for increased health care efficiency. Currently there is not a lot of incentive for the health insurance companies to cut cots, other than their "medical loss". When it rests on the doctor's there is little motivation for them to push forward changes. Take electronic medical records for example. It is bloody expensive to pay for all of the computer equipment and few direct rewards to doctors.

The path to saving can be particularly uncertain in the United States’ fragmented health care economy — a mix of risk, regulation and profit in which the incentives are often contradictory. A physician, for example, may try new approaches to trim the costs of providing care, but the results usually benefit insurers more than doctors. Strides in efficiency may be good for society, though there may be scant financial motivation for the doctors themselves.

The NYT highlight's the example of Dr. Richard Baron, who along with his three other physician colleagues spent $140,000 on computers, tablet PCs, servers, software and installation. They made the transition from pen and paper to electronic records, but it has yet to pay off fiscally.

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