Blue Cross attempts to address needs of uninsured, underinsured

One on one

December 23, 1991

One on One is a weekly feature offering excerpts of interviews conducted by The Evening Sun with newsworthy business leaders. Linda Benedict is vice president and general manager of the individual market division of Blue Cross and Blue Shield of Maryland.

Q. During the last session of the General Assembly, legislation was passed allowing Blue Cross and Blue Shield of Maryland to offer a pared-down health program to provide for the needs of the uninsured or the underinsured. What has happened since that legislation was passed?

A. The legislation really applies to any insurer in the state who wants to provide assistance to those who have been uninsured. It's not just Blue Cross and Blue Shield. What has happened since then is that we have introduced a program called Core Plan I. No other insurer, that I'm aware, has even filed for approval, to offer such a product. We began the launch a couple of months ago and are trying to reach as many people in the state who may not have had health insurance as we possibly can.

Q. What are some of the features of the plan and what has been the response? How many people have signed up for it and can individuals sign up for it or do they have to be signed up through a company?

A. The Core Plan I product is aimed particularly at individuals, of ,, whom there are 570,000 in the state without insurance. We felt that they, because they are personally at risk for high medical cost care, would be more inclined to consider purchasing than perhaps a small employer who's trying to operate on a pretty thin margin anyway. So our first step is to make this available to individuals. The price is about 25 percent below comparable products that we offer, and the reason for that is that we have limited some of the benefit categories. For example, we will pay no more than $50,000 a year in care costs under Core Plan I. We will pay for no more than 10 days in hospital. Both of those cover, or satisfy the needs of more than 90 percent of the population, probably closer to 95 or 98 percent, but it does help keep the cost down.

Q. And you say it's 25 percent below your other programs being offered individuals. Can you give me a ball park figure for how much that is a month?

A. For Core Plan I, the monthly rate for an individual between 18 and 29 would be $66. A roughly comparable product in the personal comp series would cost $89 a month.

Q. What are the needs and expectations of your individual customers?

A. We've listened a lot to them over the years. Three or four years ago we started the personal comp line with deductibles ranging from $100 up to $1000, but we were getting calls that said, "Well, I can't quite afford those premiums, so if you offer me a higher deductible, that would help with the affordability." So we extended the range of deductibles up to $10,000. We heard people asking for temporary coverage. They had just been laid off and wanted to get something to help out until they could find another job. So we introduced a program called Temp-Med that fills in that temporary need. We have also tried to influence the rate of increase in medical care costs, and we've introduced a program called Considered Care that is part of personal comp. It includes preventive benefits and thus provides encouragement to our clients to go see their doctors for regular check ups, for immunizations, for necessary screenings. We think that will help hold down the costs of serious illnesses in the longer term.

Q. How are you promoting the Core plan?

A. Core Plan I has been advertised on the radio, in newspapers and we are now participating in a coupon style mailing to many households in Maryland trying to reach as many people as we can.

Q. And what has been the response so far?

A. So far we have over 3,000 inquiries and more than 500 applications.

Q. Maryland Insurance Division recently granted Maryland Blue Cross and Blue Shield increases for its Medicare supplemental programs ranging from 8.4 to 15.4 percent. These increases along with those of other insurers have become an annual event. Can the people who buy this medigap insurance -- who are

mostly retired people on fixed income -- ever look forward to this stabilizing or will it always be increasing for them?

A. I can't really predict that, but as long as we're in atmosphere of steeply increasing health care costs, it's a reasonable assumption that rates will continue to increase. What we try to do, though, is to examine our experience and therefore the adequacy of our rates on an annual basis and we try to stabilize not only the timing of any rate changes, but also the amount so that it becomes more of a predictable thing for our clients. If we had gotten the rate increase that we had asked for a year ago on our Medicare supplemental programs, we would have asked only for an 8 percent increase this year rather than the 17 percent, or 16.7, that was in our original file.

Q. That really almost calls for a different attitude than the traditional subservient attitude to the physician. I think most people see the physician as all-knowing and all-seeing, so essentially you're asking for a lot more skepticism?

A. I think that that all-knowing and all-seeing perception used to be true. What we're hearing from our clients now is a shift, and it's not so much skepticism as it is, wait a minute, I'm an adult, I'm a fairly intelligent human being, I can ask questions, I need to understand what's going on here because it's my body after all.

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