Business

Insurers, providers attacking rising health care costs in NC

Posted October 9, 2012 4:01 a.m. EDT
Updated October 9, 2012 6:25 p.m. EDT

— Health insurance is among the fastest-growing costs of doing business, and companies large and small are trying to figure out how to manage and control those costs.

About 200 business leaders gathered in Chapel Hill on Tuesday for a health care summit meeting, sponsored by the North Carolina Chamber, to hear about what hospitals, doctors and insurance providers are doing to help lower the cost of health care.

A recent study of employer-sponsored health benefits by the Kaiser Family Foundation found that the average premium for single coverage had increased 3 percent from 2011 to 2012, while family coverage had risen an average of 4 percent.

Over the past decade, the average premium for family coverage has almost doubled, the study found.

“As a country, we spend more on health care than what the entire country of France spends on everything,” said Brad Wilson, chief executive of Blue Cross Blue Shield of North Carolina, the state's largest health insurer. "Our health care system is broken and unsustainable. We can't sit by and let that continue."

Wilson said 30 percent of medical spending is "waste and redundancy," noting that one in five medical claims that come into Blue Cross, totaling $2.4 billion, have to do with obesity and related conditions, such as diabetes.

Wellness programs are a major effort for the company, he said.

"We've got to do something, and we've got to do something now," he said. “You need to demand a system that focuses on quality, instead of quantity, and pays for healthy outcomes.”

Hospitals statewide are integrating systems to become more efficient, said Hugh Tilson, senior vice president of the North Carolina Hospital Association.

"We're trying to take cost out while still maintaining quality of care," Tilson said.

To try to keep people from going to the hospital unless absolutely necessary, he said, hospitals are expanding community care programs in which doctors help people manage chronic health conditions.

Many of the efforts are being driven by the Patient Protection and Affordable Care Act, which will take full effect in 2014.

The big question for employers is how to juggle the costs of offering health insurance. Many are weighing new options under the health reform law, such as state-run or federal health insurance exchanges, where employees can purchase their own coverage.

"You see a lot of small businesses thinking they might opt out of the system and go to an exchange, but I think what most businesses are looking for is how can they make that part of the business predictable," said Lew Ebert, president and chief executive of the North Carolina Chamber.

The tight presidential race and the prospect of Republican Mitt Romney pushing for a repeal of the health care reform law if elected only adds to the uncertainty, officials said.

Still, they said, they are proceeding with changes they see as critically to their survival.

"We're not waiting. We're moving forward anyway," Tilson said.