Big Three Health Care Co-op Could Change How You Buy a Car, Get Surgery

Aaron Cole
by Aaron Cole

Automakers may try to negotiate a massive health care co-op with the United Auto Workers — similar to the one it has with its retirees — and potentially change private health care in the U.S., Bloomberg is reporting.

At issue are the roughly 300,000 workers and beneficiaries, and 750,000 retirees and their families who rely on the UAW for health care.

The pool of more than one million workers and their families could give the Big Three unprecedented negotiating power with U.S. hospitals and clinics.

The health care co-op, already in place for retirees, has significantly cut costs for the automakers. According to the Wall Street Journal, similar cooperations between employers and health care providers — Boeing, Wal-Mart and Lowe’s — have reduced health care costs by 10 percent to 20 percent.

According to Bloomberg, the $61 billion trust established in 2010 for the UAW retirees has cut drug costs, added care and retained its assets.

The potential pool of 1 million auto workers and their families would give the group considerable leveraging power in the health care marketplace and could lead to other direct employer-provider cooperations in the future, side-stepping traditional insurance administrators.

Blue Cross Blue Shield of Michigan, which currently handles the current auto workers, may stay on in some capacity to administer the benefits, but its role would likely shrink.

During the last round of negotiations with the UAW, automakers were cool to the idea of a health care co-op, but may be warming up to the idea in an effort to further cut labor costs on cars produced in the U.S.

Of course, there are always horror stories about similar organizations like this.

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  • Corey Lewis Corey Lewis on Sep 03, 2015

    My company with Anthem BC-BS for years, until they kept jacking the prices higher and higher. Now we're with Aetna. Course now Aetna is going to merge with Humana, and CIGNA merging with Anthem. Whiddling the number of group health providers from 5 to 3. I'm sure that'll be great for premiums!

  • Slawek Slawek on Sep 03, 2015

    High insurance premiums are because of high costs of healthcare in U.S. I got MRI done in Europe this Summer for 150 Euro out of pocket, while I was on vacation there. The same MRI in WA is $2600. Thank big government for setting among others yearly quota on new doctor licenses.

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    • Mopar4wd Mopar4wd on Sep 04, 2015

      @dtremit PCH it my help. I used to work next to a workers comp unit when i worked in insurance. They explained to me how he pricing systems at hospitals work. They are giant database that was created in the 70's and 80's that constantly adjust for additional costs but is never really reviewed against actual costs. There are also huge variations in these databases. She said a heart attach in one hospital in CT might be billed at 35k in one hospital and 15k in another for the exact same treatment plan. Some of it comes down to coding and some comes down to the database. In other words many medical procedure costs have no actual basis in reality. This is why they won;t tell you how much it costs up front.

  • Dtremit Dtremit on Sep 03, 2015

    Random but tangentially related fact: the first successful open heart surgery was performed at Harper Hospital in Detroit in 1952, using a pump built by General Motors. So in a sense, they've been involved in surgery for years.

  • Gasser Gasser on Sep 03, 2015

    I have been practicing Anesthesiology in Los Angeles for almost 40 years. In the last 30 years, our fees have gone down, NOT up. That's right, lower fees than in 1984. Right now Medicare pays us about $90/hour, with the time counted from into the operating room to out. I don't get paid for reviewing big, complicated charts or for speaking with families. I don't get paid for paper work or for the classes every time our computer system is updated. I don't get paid for the time between cases when the nurses are preparing the rooms or when we are waiting for equipment, lab studies to be completed, for late surgeons to arrive or for time when patients are stuck in the paperwork of the admitting office. For every 8 hours that I am at the hospital, I estimate that I have 5 1/2 hours of billable time. Medicare pays me about $90/hr. ACA has offered about $53/hour. This is before billing and Malpractice Insurance expenses, my own health insurance, my retirement funds or mandatory medical education time. All the money in health care goes to Insurance carriers who now have about a 30% overhead, compared to 4% when Blue Cross of California was non-profit. Drug costs are obscene. Chemotherapy doses can be over $100,000 per month. Don't feel sorry for me. I just retired last month. Good luck to all of you trying to find a new physician. Try the Honda dealer. Mine gets $112/hour, twice what ACA wants to pay me and they don't handle holiday or emergency work.

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    • Len_A Len_A on Sep 07, 2015

      @gasser Then, gasser, it's all the more reason to look at single payer. I have three doctors in my family, one here in the USA, two in Europe, one in Great Britain, one in Malta. All three are general practice physicians. Guess what? The two in Europe greatly out earn the one in the USA. All are in their late thirties to very early forties. And all the horror stories about single payer systems are universally disputed by my European cousins.