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NC Blue Cross in 1994 health reform debate: “Government bad, trust us instead!”

The year was 1994 and President Clinton’s plan to reform health care was being hotly debated. NC Blue Cross was right in the midst of it as usual when then-CEO Ken Otis penned an editorial for the Durham Herald-Sun laying out Blue’s position. It boiled down to three main points:

1. Blue Cross really does support major health reform – medical costs are “rising too rapidly” and coverage shouldn’t be “denied or delayed due to a pre-existing health problem.”

2. Scary “Government-mandated initiatives” in health reform are really, really bad and shouldn’t happen.

3. Trust us to do reform right – with HMOs and managed care! “Blue Cross and Blue Shield of North Carolina sees managed care as a better way to deal with the issues of cost and affordability, as well as quality.”

Well, we know how this story ended. NC Blue Cross helped deep-six the 1994 health reform effort and instituted widespread managed care plans. Instead of containing costs, the plans merely angered patients and providers who were less than excited about Blue dictating specific health care services. Costs continued to skyrocket, with premiums for health insurance more than doubling since 1994. Nonprofit Blue Cross, awash in hundreds of millions in profits over the years, attempted twice to become a for-profit company in 1997 and 2003, failing both times when legislators and regulators made clear top executives would not see gigantic bonuses and payouts from such a change.

Now in 2009, NC Blue Cross is banging the same old drum. Blue supposedly really does support health reform. Only not that government public option or other pesky regulations. And just trust Blue to do reform right and cut costs. Hopefully we won’t be so naïve this time around. We’ll find out.

4 Comments


  1. IBXer

    November 20, 2009 at 10:56 am

    Obama’s own doctor says Obamacare is “bound to fail”.

    “Dr. David Scheiner, a 70-year Chicago-based physician who treated Obama for more than 20 years, said he was disheartened by the health care legislation his former patient is championing, calling it piecemeal and ineffectual.

    I look at his program and I can’t see how it’s going to work,” Scheiner told the Huffington Post. “He has no cost control. There would be no effective cost control in his program. The [Congressional Budget Office] said it’s going be incredibly expensive … and the thing that I really am worried about is, if it is the failure that I think it would be, then health reform will be set back a long, long time.”

  2. gregflynn

    November 20, 2009 at 3:14 pm

    Scheiner made that comment in July relative to a single payer program for which Scheider advocates, because he didn’t think any of the alternatives went far enough. He is a vocal critic of insurance companies. The fullest statement of his position at the time can be found at Public Citizen. He made the following statement to CNN more recently:

    Why are people so afraid of government in medical care when private insurance companies are already meddling with doctors and consumers all the time? Private insurance companies are screwing it up. You can quote me on that.

  3. Adam Searing

    November 20, 2009 at 4:31 pm

    Thanks Greg

  4. Lou Meyers

    November 20, 2009 at 7:17 pm

    Dr. Scheiner is not the only doctor that feels private insurance companies are screwing health care up. Here are some UNC docs that feel the same way.

    http://www.youtube.com/watch?v=oG4Nd1Qi_M8

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