North Carolina's health care system has been unkind to Kay Swan and her family. Her husband suffers from kidney disease and her son was diagnosed with Wolfram syndrome, a rare genetic disorder that can cause diabetes, loss of vision and deafness. When Swan lost her job of 18 years, her family spent their life savings on treatment—with little help from their insurance company, which was supposed to adequately cover them.
"It's because of the corruption and monopoly of health care companies," she said. "Your only crime is to be sick and you're stripped of health care."
Swan was speaking at a press conference by Health Care for America Now, which recently released a report (PDF, 225 KB), "North Carolina Health-Plan Premiums Soar As Insurers Face Less Competition." Health Care for America Now is a national grassroots organization dedicated to affordable health care. The Obama administration and more than 190 members of Congress support it.
The report shows that North Carolina private health insurance companies consolidate their coverage to raise prices for consumers. In this state of "near-monopoly," the report contends, private health companies can increase premiums or lower the quality of service without consequence.
Blue Cross Blue Shield spokesman Lew Borman countered that North Carolina has more than two dozen health insurers offering coverage. "It's a healthy market from which to choose coverage," he said.
Ninety-four percent of local health insurance markets in America are considered "highly concentrated" by the American Medical Association, and Blue Cross Blue Shield controls more than half of North Carolina's market. Overall, the two largest health care insurance companies in the state control nearly three-quarters of the North Carolina market, where health insurance premiums for working families have grown more than five times faster than their wages.
A few days before the report was released, the Washington Post previewed a new ad campaign (PDF, 386 KB) by Blue Cross Blue Shield of North Carolina, which was highly critical of President Obama's public health care proposal, and played on fears of a socialized medical system. The ads indicate that Obama's plan will lead to long waits for appointments, higher costs and fewer choices of doctors—although that is currently often the case with private plans.
In one ad, a Hispanic woman stands in a room full of "Washington people" as the ad describes them. They discuss the possible effects of a government-run system with one other, using phrases like "... yeah, a lot like Medicare ..." and "rising premiums." The woman interrupts the chatter with a question about the plan and is ignored. A voiceover then cautions viewers that a government system could have dire consequences for everyone.
Borman said Blue Cross Blue Shield "supports the vast majority of health reform," adding, "We are concerned about some aspects of government-run health insurance, but government plays an important role in helping customers who can't afford health insurance on the private market, get health insurance.
Dana Cope, executive director of the State Employees Association, a union that advocates for state employees' workplace rights, criticized what he calls the company's "hypocrisy." He said Blue Cross Blue Shield is fighting against President Obama's health care reform because it wants to minimize competition in North Carolina.
Cope also took issue with the state's bidding process that awarded Blue Cross Blue Shield the contract for the state employee health plan. The company did not have to make concessions, while state employees had to pay $600 each "for [the] health care deficit."
"This is what happens when you have a no-bid contract that your state legislative leaders allowed to happen without having a state lawyer or contract professional review the contract terms," Cope said. "It's insane."
For Lou Meyers, a small business owner in Durham, it is difficult to provide insurance for himself and his three employees. While insurance companies have to negotiate with the government and large companies such as IBM, there's no similar interaction with smaller businesses. He sees himself and fellow small business owners as a "punching bag" for insurance companies.
"They might try and go for a profit, fail, and still give their CEOs bonuses," he said. "Then they hit small businesses with a 40 percent rate increase."
Blue Cross Blue Shield CEO Bob Grezcyn earned $4 million in 2008, according to the N.C. Department of Insurance.
David Benson, another small business owner, has eight employees in Raleigh. He tells his employees to practice preventative health care by eating healthy and not smoking, but he can't afford to provide health care for all of them. He said that he would gladly pay into a public health care system.
"I pay $5,000 a year for health care myself," he said. "If I pay half of that in a public plan, I'm saving money."
Swan said she never expected to deal with such difficult health care problems in her family. America has to change its basic assumptions regarding health care, she said, along with changing the system itself.
"We need a system to fight disease, not those who struggle with it."