Health care reformers should look to Michigan

The following opinion piece was written by Daniel J. Loepp, President and CEO of Blue Cross Blue Shield of Michigan

September 1, 2009

DETROIT - This summer, Congress heard from the American People about health care. Years from now, if members of Congress recall one thing about these past few months, it probably will be the uneasy feeling of walking the yellow line that divides a road, as traffic rushes past from opposite directions.

It isn't easy to reform health care, because the American People come to the discussion from opposing views. Finding middle-of-the-road solutions should be the goal — because the common interests of America are represented there.

In crafting a better health care system, Congress should look to Michigan for success stories to copy, and failures to avoid.

Nonprofit Health Care

Michigan's health care system is predominantly nonprofit, and this is a very good thing. Blue Cross Blue Shield of Michigan, as well as the leading HMOs and all 144 Michigan hospitals, are nonprofit organizations. "Nonprofit" doesn't mean that these companies should be managed to lose money, not pay their employees well, or not compete for business.

Nonprofit means that earnings are directed back into health care for people — not to pay investors. Nonprofit implies a healthy balance between regulatory oversight and private sector ownership. This protects the interests of people through regulation, while ensuring quality coverage and care — all while keeping the government out of the "business" of health care.

A Fair and Balanced System

Earlier this year, America's health insurance companies offered to give up the practice of rejecting people due to pre-existing medical conditions if federal health care reform created a system where all Americans would be required to have private health insurance.

They would, in essence, become more like Michigan's Blue Cross plan, which does not reject applicants for health reasons.

The insurers' offer recognizes that in a fair and balanced system, where the cost of covering the sick is borne by all insurers, there is no need to reject the sick. It opens the door to competitive pricing and broad access to coverage — and takes the need for a government-run health insurance plan off the table.

Michigan lacks a fair and balanced system today. The recent premium increases approved for Blue Cross's individual insurance plans are the result of Michigan's unbalanced system, where all insurers — except for Blue Cross — reject the sick. The cost of providing health care to Blue Cross's predominantly unhealthy insurance pool has escalated far beyond the premiums collected. This results in rate hikes and premiums that are increasingly unaffordable. America can and should learn from Michigan and construct a balanced system that expands access to affordable coverage.

Collaboration and Innovation

When payers, providers and government work together, people get better health care and lower costs.

In Michigan, Blue Cross partners with the state of Michigan to subsidize MIChild. This program covers about 30,000 children who otherwise would be uninsured.

Blue Cross is an investor in the Michigan Hospital Association's Keystone Center, which the Obama Administration recently labeled a "national success story" for saving 1,800 lives and more than $240 million by improving the quality of care in Michigan's hospital intensive care units.

Blue Cross financially supports nonprofit free clinics that enable primary care access to more than 90,000 uninsured people a year.

Collaboration among competing insurance companies and thousands of doctors has Michigan third among the states for electronic prescribing.

We have an epic debate underway in Washington. Health care reform will impact every American for generations to come. It will affect one-sixth of our nation's economic output. In Michigan, a half-million jobs are tied to health care.

Health care reform needs to be done right the first time. And Congress needs to find common ground so all of America is truly represented in the solution.

Daniel J. Loepp is President and Chief Executive Officer of Blue Cross Blue Shield of Michigan, which is a nonprofit corporation and independent licensee of the Blue Cross and Blue Shield Association.

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