Massachusetts Attorney General Investigates Blue Cross and Blue Shield of Massachusetts and Partners HealthCare

Massachusetts Attorney General Investigates Blue Cross and Blue Shield of Massachusetts and Partners HealthCare in Individual Health Insurance

In a bit of health insurance industry news, Blue Cross and Blue Shield of Massachusetts and Partners HealthCare are being investigated for collusion by Massachusetts Attorney General Martha Coakley.

The insurer and health care provider are accused of making off-the-record deals in 2000 which led to high rate increases for state health insurance plans.

According to the Boston Globe, the BCBS of Massachusetts agreed to pay a “significant increase” to Partners for policyholders’ health care. In return, Partners would seek comparable payment hikes from other state insurance companies.

The Globe reported that Partners asked for $193 million over three years — a number BCBS of MA was wary of paying because it would lead to heavy rate increases for consumers. But because Partners agreed to go after big sums from other insurers, BCBS of MA went with the deal.

In addition, the Boston Globe Spotlight team found that Blue Cross pays an estimated 30 percent more to hospitals owned by Partners HealthCare than other hospitals.

Nine years later, the state’s largest Massachusetts health insurance carrier pays $2 billion annually to Partners, the biggest health care provider in the state.

Unfortunately for the Massachusetts policyholder, much of the money paid to Partners comes out of their pockets.

“The attorney general is fulfilling an important role by examining the concentration of market power by major medical providers and insurers on the cost of healthcare to consumers in Massachusetts,” said Gregory W. Sullivan, the State Inspector General.

Partners HealthCare owns major Massachusetts hospitals such as Brigham and Women’s Hospital, Massachusetts General Hospital, Newton-Wellesley Hospital, and is a teaching affiliate to Harvard Medical School.

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