Seeking a Second Opinion on Change in Health Care

The nation's largest provider of health insurance for federal employees, under fire for changes to its benefits package, says it is willing to make adjustments in answer to the complaints if only Uncle Sam would let it.

Stephen W. Gammarino, a senior vice president of the Blue Cross/Blue Shield Association, told a congressional hearing yesterday that the Blues are reexamining fee increases for the 2009 surgery benefit, the focal point of the protests, and the association is "working with OPM to pursue an alternative."

But the Office of Personnel Management says no.

Nancy Kichak, an OPM associate director, told the House subcommittee on the federal workforce, postal service and the District of Columbia that "it would be unfair to reopen negotiations with a single plan" and not do so with the other 268 that provide insurance to all the Frank and Flo Feds.

Kichak also rejected pleas from committee members to extend Open Season, the period when workers can change plans. The representatives argued that a longer period -- it's now scheduled to end Monday -- would allow federal workers more time to learn about changes in the Blue Cross/Blue Shield standard option, which covers more than half the employees and their dependents. But Kichak replied that could delay the process needed for coverage, such as getting insurance cards to patients.

The hearing was organized after the Federal Diary reported last week that standard option members next year will pay 100 percent for surgery by an out-of-network physician, up to a maximum of $7,500, "per surgeon, per surgical day."

Currently, the rate is 25 percent of what Blue Cross/Blue Shield sets for a procedure, plus any difference between that and the billed amount.

Exacerbating the problem is the Blues' broad definition of surgery.

"It includes the treatment of fractures and dislocations including casting, biopsy procedures, removal of tumors and cysts, treatment of burns, obstetrical care including childbirth, and diagnostic colonoscopy and other endoscopic procedures," complained Peter E. Petrucci, president of Sibley Memorial Hospital's medical staff.

Gammarino and Kichak said the fee change was designed to protect patients from paying huge fees that could result from the current system.

"We reasoned that if we capped the members' out-of-pocket costs, we could relieve some of the burden placed on members who choose nonparticipating providers for what is typically the most expensive type of professional service that they receive," Gammarino said.

He's willing to make modifications, but he cannot do so if OPM won't let him. Rather than hunkering down in a defensive posture, he projected the image of a concerned and savvy businessman who knows when it's time to adjust course to meet customer demands.