Blue Cross ends its broad PPO, narrowing network for patients
Evanston-based NorthShore University HealthSystem is signing on with Aetna health insurance, after Blue Cross & Blue Shield of Illinois decided to discontinue its broad PPO plan. As a result, NorthShore estimates it could lose 18,000 patients.
Patients with the Blue Cross & Blue Shield’s Blue Precision plan will still be able to visit their doctor at NorthShore.
Blue Cross is narrowing its network because of higher costs, which Dr. Joel Shalowitz of the Kellogg School of Management at Northwestern University said is becoming a more common practice with insurance companies. He said insurers have lost a lot of money on the health exchange.
“Insurers are scrambling to find out how they can save money next year. The government did promise that it would cover shortfalls, but it’s come up very short on fulfilling that promise,” said Shalowitz, Northwestern University clinical professor of health industry management.
“A lot of it has to do with budget negotiations, but it was also going to come from savings from plans that would cross subsidize the losing plans,” he explained.
Cost-cutting options are limited with government regulations on how much insurance companies can charge.
“The only thing left is to limit their networks if they want to save money,” Shalowitz said.
People who currently have the Blue Cross PPO through small group, business or employer plans will not be affected by the change. But according to Shalowitz, that means more vulnerable people will bear the burden.
“We’re not focusing on the people who have, but the people who don’t have,” he said.
Some patients might re-enroll under a higher cost plan to stay with their doctor, or, a cheaper plan with higher out-of-pocket costs. Some patients might switch doctors and travel farther to stay in network.
Blue Cross says the Blue PPO will be discontinued in 2016 for individual and family buyers.
“This is part of an overall national trend to move away from PPO plans that come with high costs to consumers and offer little in the way of coordinated care,” the company said in a statement.
Blue Cross said members have been notified of a replacement plan and that enrollment is open through the end of January.
Susie An is a WBEZ reporter. Follow her @soosieon.