Philadelphia Inquirer- July 13, 2008

Blues hearings: A chance to weigh in on a complex merger

Jane M. Von Bergen

Inquirer Staff Writer

Health-care experts point to a looming crisis: 47 million uninsured; family premiums up 78 percent in six years - enough to price individuals and employers out of insurance - and medical care consuming an ever-larger slice of the U.S. economy.

There's more.

Doctors, employers and insurers increasingly chart the link between rising health-care costs and common conditions such as diabetes and obesity. That is opening the way for electronic medical records and other systems that can keep track of patient health along with complex paperwork.

Meanwhile, insurance companies, hospitals and doctors' practices all are consolidating to achieve greater clout even as many call for a single-payer system.

It's a big issue, but this week in Philadelphia, there's an opportunity to look at it through a very local lens as speakers line up to testify at the Pennsylvania Insurance Department's hearings on the proposed merger of Independence Blue Cross and Highmark Inc.

The merger, an example of consolidation, would create the state's largest insurer. One reason the two Blues want to merge? To save money on advanced technology.

But hospitals and doctors worry about the potential clout of a merged organization as they bargain over reimbursements. Businesses want stabilized premiums. Advocates seek help for the uninsured and better care for all.

The drill: Public hearings on the proposed merger are scheduled at the Sheraton Center City, 201 N. 17th St., on Tuesday from 9 a.m. to 5 p.m. and 7 p.m. to 9 p.m., and on Wednesday from 9 a.m. to conclusion.

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Letty Thall, public policy director, Maternity Care Coalition MERGER OK? Maybe, with conditions. WORRY: The two companies, whether they merge or not, may not work hard enough to cover health services that lead to healthy babies for all women. WHY: Who pays determines what services women get. Already there's a hurdle because women of childbearing age are more expensive to insure.

Jonathan Stein, general counsel, Community Legal Services MERGER OK? No. WORRY: The merger will not help provide health care to the 800,000 uninsured Pennsylvanians. WHY: The proposed commitments to the uninsured promised by the Blues are grossly inadequate and large continue existing commitments. Even if the merger can produce $1 billion in net economic benefits, which is iffy, not enough is slated for the uninsured.

Joseph W. "Chip" Marshall 3d, chief executive, Temple University Health Systems MERGER OK? Maybe, with conditions. WORRY: The relationship with Independence Blue Cross will get lost in the merger. WHY: Independence Blue Cross has been a tough but fair negotiator when it comes to setting rates and solving problems. What will it be like with Highmark in the mix?

Joseph A. Frick, chief executive, Independence Blue Cross MERGER OK? Yes WORRY: No margin, no mission. Without the merger, it will be harder for Independence Blue Cross to insure subscribers at a reasonable rate while carrying out its social mission. WHY: Our customers want us to develop more capabilities. At the same time, there is increasing pressure to reduce costs.