The term "not-for-profit health plan" may seem like an oxymoron to consumers, who are increasingly questioning fattening profit margins and excessive corporate spending at health plans of all kinds. But there is a pathway toward providing community benefits, according to the Alliance for Advancing Nonprofit Healthcare.
Earlier this month, the Washington-based alliance issued a resource guide to help advise not-for-profit health plans in planning, implementing and reporting on their community benefits. The guide draws upon the experience of the 2-year-old not-for-profit alliance's 28 members, about half of which are not-for-profit insurers, as well as guidance developed over the past 10 years by the Catholic Health Association and VHA for their not-for-profit hospital members.
"The whole point of the guidelines is to help nonprofit health plans do a better job of making sure they are behaving differently" from for-profit health plans, said Bruce McPherson, the alliance's executive director. The guidelines "may help them better document and report publicly all the good things they are doing." The guidelines are in keeping with the group's twofold mission, which is to preserve not-for-profit healthcare as a crucial part of the nation's healthcare system and to "advance or improve performance" of the not-for-profit sector, he said.
Critics have especially disapproved of not-for-profit Blues plans for posting record profits while paying generous salaries and perks. For example, in July, a coalition of doctors, pharmacists and consumers published documents revealing that Blue Cross and Blue Shield of North Carolina spent nearly $500,000 on the U.S. Open golf tournament. The health insurer fired back with a lawsuit against the coalition for illegally obtaining and publishing confidential business information (Aug. 15, p. 10).
From a consumer's perspective, the differences between not-for-profit and for-profit health plans are not readily apparent, at least anecdotally, said Mila Kofman, assistant research professor at Georgetown University's Health Policy Institute. Even long-established not-for-profits have had to develop "similar methods" to those of for-profit health plans to stay competitive, she said.
Indeed, the introduction to the guidelines noted that increased competition from for-profit health insurers over the past three decades has made the community benefits provided by the not-for-profit plans "less apparent to government, subscribers, other stakeholders and the general public."
There apparently are few, if any, studies directly comparing the two types of health plans. A 1999 national study of community benefit activities of HMOs found that while there were many not-for-profit health plans that commonly did at least some things that were of benefit to the community, it was hard to measure the value, said one of the study's authors, Brad Gray. Health plans simply were not keeping track of the benefits they were providing, said Gray, who is now principal research associate at the Urban Institute.