Blues plan worries Chicago hospital merger would leave it out of the loop

Increased healthcare costs have been the primary focal point in federal regulators' attempt to block a merger between two major Chicago hospitals, but recent testimony from Blue Cross Blue Shield of Illinois (BCBSI) revealed the insurer is equally concerned that the merger would create another competitor, according to the Chicago Tribune.

The trial to decide the outcome of the proposed merger between Advocate Health Care and NorthShore University Health System kicked of earlier this week, with the Federal Trade Commission arguing that the merger would reduce competition and increase healthcare costs. Steve Hamman, a senior executive with BCBSI parent company Health Care Services Corp., echoed those same concerns in his testimony, indicating the merger would give hospitals more bargaining power with insurers and lead to increased costs.

But cross-examination of Hamman revealed BCBSI is equally concerned that the two hospitals would create their own insurance plan, potentially shutting out BCBSI plans altogether, according to the Tribune. Advocate and NorthShore have said the new system would offer local employers a low-cost health plan if the merger is approved. Last year, Advocate partnered with BCBSI to offer an HMO on the state insurance exchange.

More providers have launched their own health plans in response to the shift toward value-based payments. But while the number of provider-led plans are growing, many are also struggling to turn a profit.

To learn more:
- read the Chicago Tribune article

Related Articles:
FTC intervenes to block Chicago healthcare merger
Feds head to court to block Chicago hospital merger
Merger counterattack: Chicago hospitals to offer low-cost health plan if deal approved
Hospitals as insurers: Competition, costs, and considerations [Special Report]
Provider-led health plans continue to lose money, but growth opportunities exist