Does BCBS Manage Claims or Do They Just Pay Them?

One of my arguments about Blue Cross is that they do not manage claims, they just pay them…..

By Molly Mulebriar

Digging through the archives (with permission of course)  I came across an email received by back in 2008. This caught my attention because recently BCBS was awarded a contract to administer a self-funded health plan using, of course, their proprietary super duper “Best Discounts in The Whole Wide Universe” upon which claims are to be paid, saving untold millions.

But here is a possible problem with that…………………….as penned by the email sender (an experienced, national insurance consultant practice leader):

“One of my arguments about Blue Cross is that they do not manage claims, they just pay them. You never get to see in their reporting the data that shows on one page (1) Charges, (2) Ineligibles, (3) Considered or Allowable charges,  (4) Discounts on Allowable Charges, (5) Deductibles, (6) Coinsurance, (7) COB savings, (8) The final paid number.”

“Everything I have seen to date indicates that they gross up their eligible charges and take anything not paid by categories 2-7 as discounts to arrive at 8. My TPAs allow me to see 1-8 on the same page where everything matches all the other data they supply. When I have put out specs to BCBS and mandated that as part of their quote they must promise to give me 1-8 on the same page, every month, they decline to quote….which helps to prove my point about how they skew data.”

So, are Allowed Charges real, or made up, inflated numbers? Years ago one of our investigative reporters interviewed a BCBS representative. The question posed was “Are the Allowed Charges shown on this exhibit you provided your client the same as Billed Charges.” 

“Why of course not! If we showed Billed Charges you would know what our discounts are!” was her immediate reply.

Underwriters from other carriers view Blues experience with trepidation, since discounts are unknown and many times the experience is old or aggregated over multiple time periods. This forces competing underwriters to be conservative in their assumptions.

Even after that email of 10 years ago, mystery surrounding health care financing continues to this day………..