Blue Cross thinks small firms will like cap on premium hikes

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Richard Neuner,
Blue Cross and Blue Shield
of Minnesota:
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www.bluecrossmn.com

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Blue Cross execs believe small-business owners will be attracted to the Eagan-based insurer’s new product, SureBlue, in part because it guarantees a cap on rate increases for three years.

The product, aimed at businesses with 51 to 249 employees, was launched in September and will take effect for new customers in January. Rates are at the beginning in the usual way, then the increase is capped at 6 percent for the second and third years.

Neuner says SureBlue affords smaller companies a way to transition toward one of the newer types of health plan, such as a health savings account or health reimbursement account, which have high deductibles and consumer-driven options. Those products have been around for a few years, but Neuner says many smaller companies have found it daunting to make the change in one swoop.

“Blue Cross is showing them how to get from here to there, we?ve capped their risk, and they have the long-term potential to control costs,” Neuner says.

Key to the model is that the tools to contain health costs are ?embedded? in the plan, Neuner says. For example, Option 1 adjusts co-payments and deductibles, so that over the three years a member?s co-payment for generic drugs will go down, and for non-generics will rise.

Neuner says there are four elements crucial to containing health costs:

“when you encourage employees to seek their care from providers who are high-quality but more cost-efficient”

“when employees take a health risk assessment, because you can then the rich database to get services to the right people”

“when people who have diabetes, back pain, heart disease and other chronic conditions get involved in disease management”

“when you get the employer out of the game of absorbing all the cost increases.”