Blue Cross ad campaign looks at health care costs

Ad campaign features goats, and invites a discussion of health care costs.

Staff WriterApril 14, 2011 

Blue Cross and Blue Shield of North Carolina has turned to farm animals to improve its image.

The state's largest health insurer on Wednesday began a major, multimedia marketing campaign to emphasize that many parties contribute to rising health care costs.

The stars of the ads: goats. A goat with a stethoscope, a goat in a suit and tie, a goat in a Hawaiian shirt.

The tag line: Let's stop looking for scapegoats.

The Chapel Hill company also started a website, www.letstalkcost.com, to spur more discussion.

The message is that insurers, doctors, hospitals, drug companies, lawyers and consumers must work together to reduce health care costs.

But the ads are likely to spark a backlash among some consumers, physicians and others who question why a nonprofit with $5.2 billion in annual revenue needs to spend even more money on marketing. It's also risky to use funny ads to tackle a contentious topic.

"Consumers are incredibly skeptical of Blue Cross," said Adam Linker, a policy analyst at the N.C. Justice Center's Health Access Coalition, and a frequent critic of the insurer. "Blue Cross is going to have to be part of the solution, but when they hear Blue Cross talking about cost control, they worry it means Blue Cross is trying to keep more money for itself."

The campaign was designed by Capstrat, a Raleigh public relations and marketing firm that has done controversial work for Blue Cross in the past. In 2009, Blue Cross was criticized for online videos developed by Capstrat that attacked the federal health care overhaul. After some draft material was leaked, the insurer tweaked its website to emphasize that it supported reform but not a government-run universal health plan.

Cost not disclosed

Blue Cross CEO Brad Wilson declined to comment on how much the company will spend on its current ad campaign, which is expected to run into next year. Blue Cross spent $17.8 million on marketing and advertising last year, according to its annual report filed with the N.C. Department of Insurance.

Wilson added that the ad campaign's cost won't affect premiums because the insurer also is working on new ways to reduce its own operating expenses. Wilson has set a goal of slashing the company's annual administrative costs 20 percent, or about $200 million a year, by 2014. Blue Cross has more than 3.7 million members.

The TV ads feature people talking about rising health costs and at least one real goat - eating off plates at a dinner party, wearing a towel in a locker room and elsewhere.

"This is not to make light of a serious issue," Wilson said. "We made a conscious choice to use humor in this campaign as a way of opening the door to a conversation that can be complex and, at times, uncomfortable. Finding solutions to rein in medical costs is in the best interest of our company, our customers and everyone in North Carolina."

Even if Blue Cross angers some consumers and providers with the ads, it's crucial for the insurer to be seen as a leader in trying to control costs, said John McDonnell, senior partner with Progressive Benefit Solutions, a Raleigh company that helps businesses buy health coverage and other benefits.

Employers, who choose medical coverage and foot the bill for most workers, expect it. And Blue Cross doesn't want to lose ground to larger, national rivals such as Aetna, Cigna and UnitedHealthcare on its home turf.

"It's a clever campaign," McDonnell said. "It will get people talking about health care, and Blue Cross will be part of the conversation.

"People are mad about rising health costs, but no one thinks it's their fault," he added. "No one wants to be called fat, but they are. No one wants to be called inefficient, but many companies are. When you put all those goats around a table, they all have a stake in it."

Solutions needed

Even as the federal health overhaul reshapes the industry, Blue Cross will need to provide solutions to costs, such as offering more coverage that promotes healthful behavior and steering patients to the highest-quality and lowest-cost doctors, McDonnell said.

Those efforts will require Blue Cross to get cooperation from various groups, including providers and consumers. The insurer is working on some good concepts for controlling costs, including a new type of medical clinic for its members that's being developed with the UNC Health Care System, Linker said.

The challenge is that Blue Cross is also known for its "team of aggressive, stop-at-nothing legislative advocates who try to wring every benefit they can out of the General Assembly," Linker said. "They're going to have to prove they're really interested in consumers."

alan.wolf@newsobserver.com or 919-829-4572

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