Blue Cross to become sole provider in much of Georgia

Aug. 30--In nearly two-thirds of the counties in the state, Blue Cross and Blue Shield of Georgia will be the sole provider for anyone who wants to get insurance under the Affordable Care Act. It is a responsibility the company does not take lightly, and it would like to find a way to make it work, its president said.

Jeff Fusile said the company increased its request for a premium increase for next year, from on average 15.1 percent to 21 percent, after learning that Aetna planned to pull out of the state's marketplace exchange. Aetna had been in 67 counties and with Blue Cross as the only plan in every county, it will be the only option in 96 counties, Fusile said.

"You could see how it kind of played out when Aetna pulled out," he said. "We could see how much money they were losing in the markets. We immediately said, 'Is our rate appropriate to accept all of that business?' Because we have no understanding of who they have as a member."

The trend is not favorable for the insurance company, Fusile said.

"This population has been trending very expensively since it started," he said. The numbers would argue against covering many of these markets, Fusile said.

"In some of these counties, we have no business staying in, other than we think we can get this back to right," he said. "We have strategies that say, I would rather stay in with the belief that I can get it back to manageable than jump out. Because ironically, the first one to get out? No big deal. The last one to get out is a really big deal. For all of our

efforts to stay in, if we ended up needing to exit, we'd be the really bad guy."

A big argument for staying in those communities is the other business Blue Cross has with employers where it makes sense to be in the community. But it also leads to a tension between costs and premiums.

Fusile recalled a phone call telling him that a hospital in that county needed a more than 20 percent raise in payments from Blue Cross or it would close. That person later called back to say, "'Nobody in my county can afford a 23 percent rate increase on their health care expenses. I don't think you should be doing that,'" Fusile said. "It's the same person. But that is the reality.

We live on both sides of the fence."

The company accepts that it will have to pay for a certain amount of cost-shifting, paying providers more to make up for losses on charity care and perhaps on Me­dicaid, Fusile said. Asked whether Blue Cross is picking up the slack because the state has not expanded Me­di­caid to cover more uninsured patients, as some have

advocated, he said it is not the insurance companies that pay.

"You do," Fusile said, "Eve­ry consumer does. Every employer does. Anybody who is funding commercial coverage is picking up their share of that."

As the largest insurer in the state with 3 million covered lives, he wonders whether Blue Cross' share of the individual market will be back close to 50 percent, as it was in the days before the Affordable Care Act.

"We've always believed we are really good at the individual marketplace and we're really good throughout the state by comparison to others," Fusile said.

Still, as competitors cherry-pick which counties and which markets to offer plans in, he believes there should be some rules to level the playing field for those who cover all of the state.

"There could be a penalty that goes to the rural areas they are not serving," Fusile said. "There could be lots of different mechanisms to provide the incentive or the balance for people who aren't playing statewide."

That problem isn't confined to Georgia, he said, noting a Kaiser Family Foun­dation analysis that found that 31 percent of counties nationwide could have only a single provider. There is definitely a need for reform, Fusile said.

"Somebody has got to be looking at how do we create more incentives to play or more reward," he said.

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