Blue Cross CEO: South Shore Can Lead on Healthcare Costs

Blue Cross Blue Shield of Massachusetts President and CEO Sarah Iselin told a packed room of South Shore business and community leaders that rising healthcare costs pose a serious challenge, but she remains optimistic about the state’s ability to find solutions.

The South Shore Chamber of Commerce welcomed Iselin as the featured speaker for the October 8:44 Leadership Breakfast on Thursday, hosted at the BCBSMA headquarters in Hingham. She shared insights into the future of health insurance, hospitals across Massachusetts, and the efforts that BCBSMA is taking to address the myriad of concerns and challenges that lay ahead. 

“We have the distinction of being the highest cost healthcare system in the United States,” Iselin said of Massachusetts. She explained that hospital expenses, pharmaceuticals and greater use of complex services are fueling premium increases that strain families and businesses.

Even so, she emphasized that Massachusetts has a track record of solving difficult problems. “There is no better place to make progress on healthcare issues than this state. The state has a long history of solving what other states view as intractable, impossible challenges,” she said.

Iselin outlined steps Blue Cross is taking to protect affordability, including capping hospital rate increases to align with state cost benchmarks.

“I sent a letter out to every hospital CEO in the state [telling them] we are going to limit our unit price negotiations that we give you, in any given year, to on average 3.6 percent because it’s our job as a health plan to work on making [care] affordable for residents of the state,” she said.

She also pointed to the rapid rise of drug costs, which now account for nearly a third of premium cost. By partnering with other Blue Cross plans nationwide, Massachusetts has been able to save millions through joint drug purchasing.

“We saved $20 million a year by buying eight drugs together over the last couple of years,” Iselin said.

For South Shore employers, health insurance costs are a growing concern. Iselin urged local business leaders to use their voice in policy conversations.

“We need more business voices in this healthcare cost conversation. It’s businesses that are financing much of healthcare in the US and in Massachusetts. And we need the legislature to hear from you about challenges that you’re facing,” she said.

Tim Cahill, South Shore Chamber president, noted that while challenges are real, Massachusetts remains fortunate because of the access to health insurance and healthcare in the Commonwealth. “I am proof and she is proof that healthcare and the health insurance system works,” Cahill said, recalling how his sister received life-saving care following his kidney donation 25 years ago. “It doesn’t work perfectly, but it works.”

Iselin acknowledged that maintaining affordability will come with difficult trade-offs.

“I don’t think every hospital that’s open right now will be open in five years,” she said. 

Still, she told South Shore leaders that challenges can be turned into opportunities if businesses, policymakers, and health plans work together. “Sometimes a funding crisis can create opportunities because everyone is struggling right now… Sometimes that creates opportunities to put aside our personal interests and say how do we make this better for everybody,” she said.

Iselin ended on a hopeful note. “Even though we’re in a tricky moment as it relates to healthcare in the state… I really do think we’re going to get through this, learn a lot, and be stronger on the other side.”

The event was part of the Chamber’s ongoing efforts to spotlight issues that affect the region’s economy and quality of life.