Harvard Research Shows Cost Rise In Health Coverage

A Harvard research team has released a study showing that Blue Cross and Blue Shield nationally spent 60 per cent more for administrative costs per subscriber in 1969 than in 1965.

Dr. Robert J. Weiss, Dr. William Wiese and Dr. Joel C. Kleinman of the Harvard Center for Community Health and Medical Care reported their analyses of 74 Blue Cross and 73 Blue Shield plans in the New England Journal of Medicine.

They concluded that 140 million subscribers could have saved $119 million in 1969 had all the Blue Cross-Blue Shield health insurance plans been administered as efficiently as a mere few had.

The study found that one Boston-area institution using a Blue Cross-Blue Shield plan for its employees paid $15.72 to administrate each claim, although over one-third of the claims filed were under $20.

Massachusetts Costs Doubled

During the interval studied, the report states. Massachusetts Blue Cross-Blue Shield processing expenditures doubled for each enrollee.

"Up to the present, there has been no incentive for private insurance companies to monitor their own costs, because these are always passed on directly to the consumer," the doctors said.

Blue Cross and Blue Shield officials countered the charge of poor management and inefficiency. They asserted that the culprit is the increased cost of fighting medical inflation and the greater benefits offered to their subscribers.