A few months ago, North Carolina's largest insurer was hesitant to reveal hospital payments on a state-mandated consumer information website. Now, it's making a bigger leap with its own online transparency initiative.
Blue Cross and Blue Shield of North Carolina has unveiled a new public website comparing the costs of about 1,200 procedures across its provider networks -- an attempt to offer consumers a guide in the great morass of healthcare reimbursement, and also a risky move that may leave some providers feeling underpaid.
"We're working to take the mystery out of healthcare," said BCBSNC President and CEO Brad Wilson. "This information will help consumers get more bang for their healthcare buck."
The tool shows what BCBSNC pays hospitals and clinics in its broad-network Blue Advantage plans and its narrow-network Blue Value plans. To figure out what they'd pay out of pocket, members can use another tool unveiled in 2012, Blue Connect, to get estimates based on their health plan.
The public database's 1,200 procedures represent about 80 percent of the insurers' non-emergency healthcare spending, and predictably, it shows a wide variation in payments across facilities and geographies.
In greater Charlotte, BCBSNC's reimbursement for an abdominal ultrasound ranges from $135 to more than $700. For a knee replacement in greater Raleigh, the reimbursement varies from $20,000 at North Carolina Speciality Hospital to $29,000 at Duke University Hospital to $35,000 at UNC Hospitals under the Blue Advantage plans.
"Many consumers believe that the highest cost facility is the highest quality facility, but that's often not the case," said BCBSNC chief medical officer Susan Weaver, MD. "We know that our customers want the highest quality healthcare, but like any purchase they make, they don't want to pay more than they have to."
Back in November, BCBSNC was fighting against what it saw as a flaw in North Carolina's Health Care Cost Reduction and Transparency Act, a 2013 law requiring hospitals to disclose their charges to the five largest insurers for the 100 most common admission cases and the 20 most common outpatient imaging services and surgeries.
BCBSNC's network management vice president Mark Werner argued that as the state's largest insurer, with 70 percent commercial market share, it would be singled out unfairly and indirectly, because although the insurers are deidentified, consumers, hospitals and rival insurers could figure out what BCBSNC is paying since it is the only insurer to cover all the reported diagnosis related groups.
The insurer was not trying "to interfere with the reporting requirements or the Act's mandate for greater transparency," Werner wrote. But he argued that there are grounds for delaying or amending the reporting, namely North Carolina's proprietary information protections for businesses.
Under the North Carolina Trade Secret Act, "any information or formula that derives independent commercial value from not being known and is the subject of reasonable efforts to maintain its secrecy may qualify as trade secrets," Werner said at the time. "Non-public financial information that has been properly protected has routinely been determined to qualify as a trade secret."
BCBSNC asked the state's Medical Care Commission to delay the release of the data, but the commission concluded that would require a change in the law and went ahead with the disclosures online in the first week of the new year.
Thus the timing of BCBSNC's release may not be coincidental.
Comparing the two websites and their procedures is not at all apples to apples; the state's website includes many DRGs related to emergency care and also relies on its fees to insurers, which is not necessarily the actual reimbursement.
In any case, the new websites by BCBSNC and the state are beacons of light in the Dark Ages of healthcare transparency. It remains to be seen whether many consumers use either website as part of their decision-making, or whether providers use as them as part of reimbursement negotiations.