How Massachusetts Blue Cross audited hospitals

There’s nothing really exciting or interesting about this story except this: since I’ve been putting this blog portfolio together, I’ve been struck by how similar the news 30-40 years ago was to now. We’re still seeing stories about medical costs, insurance and reimbursements, not unlike this story from the early 1970s. Hospitals are still complaining about their insurance reimbursements, and insurance companies are still moaning about how much hospitals charge for their services. I found this clip in the Lowell (Mass.) SUN, which apparently didn’t know quite how to play the story — they ran it on the OP-ED page.


BOSTON (UPI) – Hospital costs in Massachusetts are audited to determine Blue Cross reimbursement rates, and the 37 men who do the audits are on the Massachusetts Blue Cross payroll.

The auditing procedure has been allowed since May 18, 1956. Chapter 176A of the General Laws says the state Rate Setting Commission can require that an audit be conducted prior to having Blue Cross reimbursement rates established at hospitals.

The Commission contracts Blue Cross to do the auditing. The auditors answer to the Rate Setting Commission, but are paid by Blue Cross and receive Blue Cross fringe benefits.

Blue Cross pays hospitals either what a given treatment costs the hospitals, or what they charge for that treatment, whichever figure is lower. The hospital’s cost of treatment is generally lower than what it charges, and that is usually the figure paid the hospital by Blue Cross.

The audit determines what the hospital costs are.

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Investigative journalism: Campaign contributions

Reporters are always looking for stories like this, but I don’t remember how I found this one. I do remember that I was not the regular State House Reporter for UPI and that I had been sent over there for the day to cover for the regular beat reporter, who was out sick. There were probably 30 or 40 regular beat reporters covering the Massachusetts State House back then, and I don’t recall how I got this story exclusively. This wasn’t the story of the year, but it was pretty good and it made every Massachusetts daily newspaper the next day, including the Boston GLOBE. That was pretty cool because the Globe had a four or five-person State House bureau, and getting something in their own paper that they didn’t have was something of an achievement.

McCann may have broken campaign laws



BOSTON (UPI) – Sen. Francis X. McCann of Cambridge has attributed $12,698 in campaign contributions to the “McCann Reception Committee,” which he claims is a non-political group. The move appears to violate state law.

State law states candidates are required to file lists of campaign contributions and expenses with the state Elections Division. The law’s purpose is to make available to the public information on where a candidate’s money comes from and where it goes.

Of the $13,473 contributed to McCann’s primary campaign, only $775 is attributed to contributors other than the McCann Reception Committee.

Secretary of Public Records Andrew R. Sigourney said Wednesday his office would turn the matter over to the Attorney General’s office if McCann did not disclose the names of his contributors.

Reached Wednesday night, McCann acknowledged that he considered the McCann Reception Committee to be a non-political group.

“This was a testimonial dinner for me,” he said. McCann said he didn’t remember when the dinner was held but said he thought it was “sometime last spring.”

McCann filed his list of contributors with the Elections Division, but that office returned it with a note requesting the names of the contributors to the McCann reception Committee.

McCann wrote back, saying he could attribute the $12,698 only to the McCann Reception Committee because the group was “non-political.”

Sigourney said the Department of Public Records considered the move in violation of the law and would ask McCann again to comply. He said the matter would be turned over to the Attorney General’s Office if he refused.

McCann said he still had the names of those persons who bought tickets to the testimonial.  “Thank God we didn’t throw anything out,” he said.

According to law, candidates can list contributions from non-political groups and name only two officers of the group. But Sigourney said the state considered a non-partisan group to be “as labor union or something like that.”

“He’d reported a sum of money as coming from the association,” Sigourney said. ”When gifts are made by an association, we require names and addresses of two principal officers, as required by Chapter 55, Section 88 of the General Laws.”

“However, he (McCann) claims as an association what we interpret to be a political committee,” he said.

McCann, a Democrat, has been a member of the Massachusetts Senate since 1955.