Florida Blue CEO Says Single-Payer Is Wrong for Future of Health Care

By: William Patrick FloridaWatchdog.org | Posted: February 22, 2014 3:55 AM
Pat Geraghty

Pat Geraghty

Is Obamacare the first step toward a single-payer health care system?

“Some people think so,” Pat Geraghty, CEO of Florida Blue, told Watchdog.org.

Geraghty’s guarded response came on the heels of a presentation he gave earlier this week at the Economic Club of Florida on the future of health care.

“If it does, we’ll be a payor,” Geraghty said, guaranteeing his company’s relevance under a Canadian- or British-style health system. “We have 32 percent of Medicare payouts.”

Florida Blue’s size and market strength -- it was formerly known as Blue Cross Blue Shield of Florida -- is undisputed. It’s the state’s largest health insurer offering plans in all 67 Florida counties. In 47 counties, it’s the only health insurance provider.

But under a single-payer system, in which the government pays for all health-care costs, the private insurance giant essentially would be relegated to a government contractor. Many other private insurers wouldn’t be so lucky.

“There’s too much space between where we are now (with the Affordable Care Act) and the single-payer option,” Geraghty told Watchdog.org. “There’s lots of room to innovate between here and there.

“The answer isn’t going to single payer,” Geraghty said. “The answer is developing new partnerships.”

That’s Florida Blue’s strategy for survival -- expansion -- and dealing with the ever-rising cost of health care.

“The price of health care isn’t going down. It’s being masked to the consumer,” Geraghty said.

The $10.5-billion company only has a profit margin of $100 million, according to Geraghty. This year alone, Florida Blue is facing $110 million in new Obamacare taxes. Those taxes, he said, are getting passed on to consumers.

Other costs include covering young adults until age 27, accepting high-cost patients with pre-existing conditions and the elimination of catastrophic plans to meet the new minimum-coverage requirements.

Though insurance companies will receive more taxpayer-funded revenue for taking on high-risk people, the higher costs ultimately will be paid by consumers. Some consumers will receive government subsidies to offset higher prices, but many others won’t.

Florida Blue is honoring tens of thousands of previously canceled policies due to Obamacare. Given a choice between their old plans and new Obamacare standardized plans, Geraghty said 90 percent of his customers opted to keep their plans.

Contact William Patrick at wpatrick@watchdog.org or follow Florida Watchdog on Twitter at @watchdogfla.

Comments (7)

11:35AM FEB 24TH 2014
Whenever these republican talking heads speak, just add "profits" after their talking point, and you understand their position. The title of this article should be "Florida Blue CEO Says Single-Payer Is Wrong for Future of Health Care Profits" and it all suddenly becomes crystal clear.
10:48AM FEB 24TH 2014
The European system doesn't have the high quality of care contained in the American system. People pumping the European system have obviously never had to use a specialist who utilizes cutting edge technology and procedure. The reason is simply that single payor doesn't reward innovation and investment the way the American system does. They cap the upper end return on investment, and then rely on American innovation for advances in medical devices, innovative procedures, and cutting edge pharmaceuticals.

With all the faults of the American health care system, it does produce the best results in innovation. You do not get that when you snatch incentives for innovation, which is exactly what single payer does. It does so by cutting the dollar flow out of the upper tier and flowing it to the lower tier. Dumbs down the entire system.
11:26AM FEB 24TH 2014
On average the European Social Democracies have better healthcare outcomes at less than 65% of the per capita cost of the American system . And are every bit as advanced.
11:02AM FEB 24TH 2014
Your first sentence is absolutely untrue. I have many European friends who have received extraordinarily advanced specialized care in their home countries.
7:08PM FEB 22ND 2014
If you spend anytime in Europe, it is obvious that the single payer system is the most cost effective, efficient and humanitarian way to provide medical care. Once you remove the profit motive, costs plummet and outcomes improve.
1:06PM FEB 22ND 2014
Who could imagine! Single payer has proved itself to be the best solution for providing health insurance . Now if it were instituted with the opportunity for the health insurance providers to bid on administering single payer as well as offering supplemental policies I bet that would both work out reasonably well but still miff Mr. Geraghty and his peers because it might affect their personal incomes. But probably not as they would inevitably slash staff pay and benefits to the bone while maximizing their pay and benefits.
N. Lois Adams
11:41AM FEB 22ND 2014
Florida Blue does not want "single payer" but it believes in "single provider"
pharmacy especially specialty pharmacy where it sends all of its specialty prescriptions to its BCBS owned-pharmacy against the wishes of its plan members. This should be addressed and dealt with appropriately by the lawmakers.

Leave a Comment on This Story

The content of this field is kept private and will not be shown publicly.
To prevent automated spam submissions leave this field empty.