Insurers concerned that inclusion of GRMC in health plan will drive costs upWritten by Janela Carrera
Guam - Local insurance agencies are raising concerns about the potential for healthcare costs to go up if a bill that would mandate the inclusion of the Guam Regional Medical City in GovGuam insurance plans passes into law. But the private hospital testified at a public hearing yesterday that inclusion of GRMC would actually help save patients money.
Bill 21 would mandate the inclusion of the GRMC as an in-network provider for the government of Guam’s health insurance plan. At a public hearing for the bill yesterday, at least three of the four major insurance providers in Guam testified that the bill could drive costs up and would remove the insurance agency’s negotiating power. Calvo’s SelectCare’s Gina Ramos spoke on behalf of their Plan Administrator Frank Campillo.
"The possible consequences of this bill are that the private hospital provider will have a significant advantage against insurers, knowing that insurers must have an agreement with them and possibly demand rates that may not be feasible in our market place," Ramos said, reading from a written statement from Campillo.
Without GRMC’s inclusion in GovGuam’s health insurance plan, insurance companies have the ability to negotiate rates with the private hospital. But Ramos explains that requiring GRMC’s inclusion would give the hospital more power to set its own rates.
But GRMC CEO Margaret Bengzon disagrees and says the bill would actually help patients, especially those who seek care at GRMC for services that are otherwise not available on Guam.
"The most important reason to have insurance in the first place is that you want to be protected from incredible expenses that could occur if you get very very sick and the reason you pay these premiums is to buy that protection. To the extent that there may be marginal increases in premiums may be justified by the fact that you are now covered for a broader range of services," Bengzon noted.
Local physician Dr. Hoa Nguyen with American Medical Center and the Guam Medical Association also testified yesterday against the measure, saying he speaks on behalf of his patients who are concerned that healthcare rates would go up.
"If you do that the only thing it will do is drive the cost up because the insurance that’s required by your mandate to pay this high amount, that means the premiums will go up in the next year on that employee," shared Nguyen, noting that as an example, an appendectomy at the Guam Memorial Hospital could cost $2,000. "If you mandate certain hospitals that they include this insurance, that hospital wants to make them pay 1$0,000, we’re stuck with $10,000. We cannot negotiate that price anymore."
Meanwhile, Vice Speaker Therese Terlaje questioned GRMC’s commitment to keeping costs down.
"I think the point is we’ve already negotiated our rates for this year for the health plans that have contracted," said Bengzon.
"Right, but the government is about to, they’re going to begin negotiation soon for a new contract and that’s what I’m looking at," answered Terlaje as the two went back and forth over the currently negotiated contract for 2017.
"I think what she’s trying to get is, yes, you have two-year negotiated agreements with them but at the end of the two-year negotiated agreement with whatever little percentage it is that you negotiated, will it mean that at the end of the two years you’ll say, 'I no longer need to negotiate with you. I’m mandated to include you and you will include me at the rate that I tell you that I’m going to be included?'" clarified Speaker BJ Cruz.
"Like I said I think we have to be judged by a track record ... and so there is no intention, for as long as I’m heading up this organization there is no intention to take advantage of the situation," said Bengzon.