Health Perspectives Vol. I No. 6 July-August 1974


This publication recalls many of the issues that surrounded the right of the public, consumers and third party payers to have access to information deemed ‘confidential’. Most of the information so deemed was classified as confidential at the behest of the industry a prime example was the agreements between Blue Cross of New York (formerly known as the Associated Hospital Service of Greater New York, Inc.) and is member hospitals. But even within this closed hospital insurer-hospital complex a great amount of information was denied to member hospitals. Often information was cloaked in secrecy by providing aggregate data or even specific data that was masked by code names, random numbers or distorted presentation; all designed to ensure that nothing Blue Cross wanted disclosed was disclosed.

But the secrecy was most damaging for Blue Cross individual subscribers and the government, employer and labor-management groups that had hospital insurance coverage with the ‘Blues’. The number of Americans covered by the Blues in 1950 was about 100,000,000 of the roughly 152,000,000 Americans (or almost two thirds of the entire population). After adding in the number of people enrolled in CHAMPUS (insurance provided by the Blue Cross Association through its member Plans for individuals and their families in the armed forced), VA coverage, Public Health Service programs, Medicare (for those age 65 and older) and Medicaid (for those individuals and families meeting income and asset eligibility standards), there was only a small number of Americans who had private for-profit insurance coverage or no insurance at all. The Blues administered as third party intermediaries most of Medicare Part A (hospital) claims and Blue Shield, its medical counterpart, handled most of the Medicare Part B (doctor) claims.

This background is important to know because the political payoff to the hospitals and doctors to gain their support for Medicare and Medicaid included guarantees for cost plus hospital reimbursement and fee-for-service payments to medical doctors. In addition the Medicare Act included provisions related to confidentiality of patient data and stated that the government though this Act guaranteed non-interference with the practice of medicine.

So the CCAHS wrote this issue of Health Perspectives on the question of confidentiality and the right of the public to know what till then was a carefully constructed edifice to keep potentially embarrassing data confidential. In one section we collected and analyzed Federal Disclosure Acts and Regulations followed by similar information related to New York State. The rub was that the then enacted legislative acts at both the federal and state levels called Freedom of Information (FOI) conflicted with the culture and practice of secrecy. So the CCAHS listed information that was public by source and described in detail how consumers could obtain information under the FOI laws and regulations.

Soon after a firestorm spread among the ranks of providers who could with some justification say that their participation in government and private sector insurance programs, their fees and income should be exempt because a social bond between the professions and the government had been broken. Consumers and their organized groups had equal force of argument stating that secrecy is anathema to an open democratic society and that deals made in secret are null and void. And once again, CCAHS felt the heat of many vested interests which saw the CCAHS efforts as undermining America’s values. Government agencies now caught between the demands for disclosure under FOI and the threat of litigation by powerful industry and individuals did their best to meet the requirements of the law but as a general rule delayed responding and when they did often said that the request was not clear, specific or accurate and as such could not be answered. When all else failed administrative fees to research, copy and mail responses became prohibited to some and offensive to others. Today the politically correct verbiage is transparency. Everyone wants to act with transparency. Yet, the efforts to break the veil of transparency are often handled with carefully and often misleading sound bites and images.

Blue Cross always had a policy of not revealing anything important to its subscriber groups and was able to parlay this policy for years by its close relationship with the New York State Department of Insurance. Instead of that department operating to protect the public, it often took a posture defending Blue Cross. When Blue Cross applied its rate structure based on the prior period’s experience (usually one year) it disclosed aggregate data and only to the extent its marketing and reimbursement departments felt relevant. Subscriber groups were left with little information to review and negotiate better rates. Even group consultants approved by Blue Cross were given little additional data and more often than not converted to promulgating and supporting the Blue’s position.

But what was not covered by CCAHS or anyone else to this date is that even with full disclosure consumers as a group and as individuals could not use most of that data now disclosed to make informed and effective decisions about their wellness, health and medical care. There are many reasons why this is true but denied. The definitions of quality, necessity, and even what is a legitimate cost (vs. expense) still do not exist with uniform acceptance. Yet, even with a clear and agreed to definition there are many variables that negate having the data. First there is too much data; most not relevant, accurate or timely. An example is the person experiencing the symptoms of a severe heart attack. Does that person or delegate have time to identify the highest quality, most effective and safest hospital, medical and ancillary care? Assuming time is not of the essence, would that data affect a decision to go to the nearest hospital as quickly as possible? And would that hospital, medical and ancillary staff be available? And would they be part of the insurer’s network? And what if the hospital is, the medical doctors are not and the ancillary providers are a hit or miss?

Another issue is the accuracy of the data. There is rarely a hospital, medical center or group of medical doctors that report successes (however defined) and failures, errors, adverse reactions, price lists, etc. Or should any consumer assume that they all did which organization or agency would certify that the information is true and comparable to the data provided by others? The simple answer is that there is no answer. The complicated response is that each provider will state that it provides the best equipment, staff, and diagnostic services bar none. To bolster these claims a plethora of people, all patients, will attest that they have received the best care available anywhere even thought these (mostly) actors have no idea if they did or didn’t. While this is effective advertising for cancer centers and hospitals, no one comes back after death to recant their adoration and faith in the care they thought was the best.

The focus of the CCAHS was elsewhere; dealing with important and critical issues as they presented themselves in the 1970’s. As CCAHS could often project changes in costs and expenses during future years, it could not anticipate the complete impact of rapid privatization.

Download the PDF file .

Leave a Reply