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Repeal Benefits Blue Cross Blue Shield

From The Post and Courier:

By Renee Dudley–Sunday, July 3, 2011

In 2006, the South Carolina Legislature repealed a decades-old insurance code, stripping the state’s authority to regulate discounting in contracts between hospitals and insurers.

The deletion allowed the state’s biggest health insurance company, Blue Cross Blue Shield, to negotiate contracts that could cripple its competitors and raise costs for consumers. And Blue Cross was among the special-interest groups lobbying for the repeal, according to a legislator who requested it.

Although the state apparently had not enforced that section of the law, the repeal stripped regulators of authority to step in if it became necessary to regulate anticompetitive activities.

The code appears to have forbidden types of “most-favored-nation” contracts with hospitals and doctors, which some economists said have played a significant role in driving up health care costs in South Carolina. Continue reading

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