The health insurance industry was rocked recently with the news that two Massachusetts health insurance providers are being investigated for collusion. Partners Healthcare and Blue Cross and Blue Shield of Massachusetts are accused of making deals off the record in 2000 which were crafted to bring higher rates for state health insurance plans. The office of the Massachusetts Attorney General Martha Coakley is leading the investigation.
The investigative reporting team from the Boston Globe reported that BCBS paid large premium increases over the years to Partners Healthcare, which would cover health care charges for their policyholders. Partners was to agree to seek similar high rates from other state insurance companies in the agreement. It was reported that Partners asked for $193 million over a three year period, but BCBS was wary of such a high amount because it could lead to significant rate increases for consumers. Partners reported their intent to go after similar large increases fromother insurers, so BCBS agreed to the deal.
Additionally, the Globe Spotlight reporting team discovered that BCBS continues to pay an estimated 30% more to hospitals which are owned by Partners Healthcare than they pay to other hospitals. After nine years, BCBS, the state's largest insurance carrier, is paying an estimated $2 billion yearly to Partners healthcare, the state's biggest health care provider.
The Massachusetts policyholder is the one who is the unfortunate loser in the game, however. Much of the money that Partners receives comes directly out of their pockets. By undertaking this investigtation, the attorney general is fulfilling an important role by examining the unprecedented concentration of market power by health care providers and insurers. The effect the scheme has on consumers in Massachusetts has been negative in all respects.
Partners Healthcare is the biggest operator and owner of hospitals in Massachusetts. They operate several hospitals including Newton-Wellesley Hospital, Brigham and Womens Hospital, and Massachusetts General Hospital. They also serve as a teaching affiliate to Harvard Medical School.
The investigative reporting team from the Boston Globe reported that BCBS paid large premium increases over the years to Partners Healthcare, which would cover health care charges for their policyholders. Partners was to agree to seek similar high rates from other state insurance companies in the agreement. It was reported that Partners asked for $193 million over a three year period, but BCBS was wary of such a high amount because it could lead to significant rate increases for consumers. Partners reported their intent to go after similar large increases fromother insurers, so BCBS agreed to the deal.
Additionally, the Globe Spotlight reporting team discovered that BCBS continues to pay an estimated 30% more to hospitals which are owned by Partners Healthcare than they pay to other hospitals. After nine years, BCBS, the state's largest insurance carrier, is paying an estimated $2 billion yearly to Partners healthcare, the state's biggest health care provider.
The Massachusetts policyholder is the one who is the unfortunate loser in the game, however. Much of the money that Partners receives comes directly out of their pockets. By undertaking this investigtation, the attorney general is fulfilling an important role by examining the unprecedented concentration of market power by health care providers and insurers. The effect the scheme has on consumers in Massachusetts has been negative in all respects.
Partners Healthcare is the biggest operator and owner of hospitals in Massachusetts. They operate several hospitals including Newton-Wellesley Hospital, Brigham and Womens Hospital, and Massachusetts General Hospital. They also serve as a teaching affiliate to Harvard Medical School.
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