We don't pick any fight lightly, and certainly not with Blue Cross Blue Shield of North Carolina (BCBSNC), our state’s overwhelmingly dominant insurer.
Mission Health and BCBSNC have had a good relationship for many years. We’ve worked together to provide exceptional care to the people of western North Carolina. Although we had a similar fight more than a decade ago, everything turned out just fine. We need them, and they need us.
So when Mission approached BCBSNC six months ago to request a modest, mid-single digit reimbursement increase, we expected BCBSNC to work collaboratively toward a mutually acceptable contract. Instead, BCBSNC flatly refused, forcing a “forever zero” contract, claiming it can't afford any increase despite dramatically raising premiums to its own customers during each of the last four years.
BCBSNC claims: "customers pay more for Mission’s care than at many other health systems." In fact, Mission’s prices are 23% below similar hospitals in North Carolina and 7% less than local hospitals. In December of 2015, the New York Times highlighted Asheville as a best practice with health care costs among the lowest third in the nation for both Medicare and commercial insurers. Even so, Mission has continually reduced costs, eliminating more than $67 million just this year; by 2018, Mission will have reduced annual costs by more than $240 million since 2012. These huge savings are essential to keep Mission financially stable.
Despite these cuts, costs outside our control – including drugs, medical supplies and technology – rise continually. Government payments decline and demand for free care climbs – we’ve provided $120 million in charity care - up $20 million from last year – just since October 2016. Every health system loses money on Medicare and Medicaid, but our regional demographics and Mission’s unique safety net role mean more governmental and uninsured patients than most any health system.
Despite these challenges, Mission has become one of the nation’s best health systems. Our exceptionally talented and experienced physicians, nurses and caregivers deliver objectively higher quality care and have dramatically lower mortality and readmission rates than state and national benchmarks with high patient satisfaction scores. But without a modest rate increase from BCBSNC, Mission will not be the health system that it has been for more than a hundred years.
We simply can’t cut our way to financial health without degrading programs, quality and jobs. Mission’s commercial health plan contracts are uniquely vital to our long-term health. Mission must be paid fairly, otherwise, we enter a path ending in financial disaster. And there will be no recovery – not for Mission, not for western North Carolina.
Mission Health is a non-profit organization governed by a board of volunteer directors. Today, we come together as citizens who live and work in this community. We care deeply about western North Carolina so we care about Mission Health. And we unequivocally support Mission’s management team’s efforts to secure a reasonable contract with BCBSNC.
Many see Mission as a big organization with deep pockets, noting new buildings and technology as signs of prosperity. While Mission is healthy today, our financial foundation is remarkably fragile. Mission relies disproportionately on payments from BCBSNC – which controls whether Mission is in the red or black. Unlike most prosperous businesses, Mission’s "profit" is a low single digit, hovering around 2-3%. Mission has remained stable only because of yearly cost reductions; additional cuts beyond those already planned will force us to eliminate programs and jobs and harm quality. Make no mistake, if Mission agrees to BCBSNC’s “forever zero” contract, it will not survive. A fair contract is not a want, it is an absolute need.
We know this is a complicated issue. Healthcare prices make little sense to anyone. But we are local citizens - just like you - and we hope you trust that we have our community’s best interests at heart. We all want quality healthcare, great doctors and nurses and modern facilities with the latest technologies close to home. We are so accustomed to Mission making that possible that at times, we take it for granted. We shouldn’t, because it isn’t guaranteed.
The people of Western North Carolina need Mission and BCBSNC working together. This isn’t an issue just for BCBSNC customers – the lack of a fair contract will affect everyone’s care across the region. So we are asking for your support in encouraging BCBSNC to engage and re-join us in our effort to deliver high quality health care to the people of western North Carolina.