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Blue Cross Blue Shield Launches Program to Increase Health Care Transparency

JUNE 8, 2006 -- National health care insurer Blue Cross and Blue Shield Association (BCBS) on Thursday announced a new nationwide program aimed at increasing transparency of health care costs and quality. The program, called Blue Distinction, will use existing measures to gather hospital and physician data and provide the information to the insurer's 94 million members.

In a conference call Thursday, Scott Serota, BCBS president and chief executive officer, said the program is based on the belief that through transparency, consumers will become "more judicious purchasers of health care." He added that the program also intends to improve quality outcomes and health care affordability.

Health care price transparency has been a major focus for the Bush administration. In February, President Bush said that legislation might be needed to ensure that hospitals, physicians, and other health care providers give consumers more detailed information about the cost of health care services. And on June 1, the Centers for Medicare and Medicaid Services posted information on what Medicare pays for 30 common elective procedures—including hip and knee replacements and heart operations—and other hospital admissions.

The Blue Cross Blue Shield program is made up of three different components: transparency demonstrations, a hospital measurement and improvement program, and Blue Distinction centers that specialize in bariatric surgery, cardiac care, and transplants.

According to Serota, 17 BCBS plans are currently conducting transparency demonstrations, using BCBS Minnesota's online consumer information tool as an example. The main objective of the demonstrations is to provide consumers with "absolute and relative" costs of procedures and services, according to a BCBS news release. When asked about the cost information provided to consumers, Serota emphasized that data would include a range of prices because cost varies by specific diagnosis or insurance.

Through the Blue Distinction Hospital Measurement and Improvement program, BCBS will collaborate with medical societies and providers to integrate standards of care for common conditions using measures set by the Centers for Medicare and Medicaid Services and the Agency for Healthcare Research and Quality.

The Blue Distinction Centers, which are based off the Blue Distinction Centers for Transplants established by BCBS in 1991, will use criteria including quality and care outcomes to select hospitals to act as centers for bariatric surgery and cardiac care. According to a BCBS statement, a national provider locator for Blue Distinction Centers will be available to BCBS members July 1.

When asked if BCBS was planning on collaborating with CMS's price transparency efforts, Serota said, "We're doing this as a Blue initiative." He added, "While we communicate frequently, we're not working in partnership with CMS."

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