Comments on: What is NC Blue Cross up to with an extra $1.2 billion and a new for-profit subsidiary? http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/ Affecting NC public policy through informed, energetic and progressive conversations. Sat, 11 Feb 2012 18:17:29 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Larry Kirsch http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-7109 Larry Kirsch Wed, 26 Mar 2008 23:33:20 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-7109 You've hit on a timely issue with nationwide significance. In addition to looking at conversions of nonprofit health plans (e.g. BCBS), policymakers are becoming more interested in the level of surpluses held by health plans (are they excessive?) and the creation of for-profit subsidiaries ("creeping conversions"). Three issues have been at the forefront: 1. Whether the policyholders of nonprofit health plans have been subsidized by a Plan's for-profit subsidiaries or vice-versa; 2. The extent to which the nonprofit plans have effectively been taken over by their for-profit subsidiaries and what the consequences have been; 3. Whether the reported surpluses of these nonprofit holding companies are accurate and if they are in line with their financial risks. I helped a consumer-union-municipal coalition review the matter up in Pennsylvania where we found that surpluses in the state's 4 BCBS Plans were excessive and (in some cases) understated-- primarily because of the significant role of for-profit subsidiaries. The net effect was that policyholders were paying too much in premiums. You’ve hit on a timely issue with nationwide significance. In addition to looking at conversions of nonprofit health plans (e.g. BCBS), policymakers are becoming more interested in the level of surpluses held by health plans (are they excessive?) and the creation of for-profit subsidiaries (“creeping conversions”).

Three issues have been at the forefront:

1. Whether the policyholders of nonprofit health plans have been subsidized by a Plan’s for-profit subsidiaries or vice-versa;

2. The extent to which the nonprofit plans have effectively been taken over by their for-profit subsidiaries and what the consequences have been;

3. Whether the reported surpluses of these nonprofit holding companies are accurate and if they are in line with their financial risks.

I helped a consumer-union-municipal coalition review the matter up in Pennsylvania where we found that surpluses in the state’s 4 BCBS Plans were excessive and (in some cases) understated– primarily because of the significant role of for-profit subsidiaries. The net effect was that policyholders were paying too much in premiums.

]]> By: Max http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6771 Max Wed, 12 Mar 2008 19:25:21 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6771 Oh, and I'm not concerned about ERISA-exempt companies as much as the individual market, which is where the uninsured can or cannot get insurance. So when I'm talking about competition, I'm talking mainly about the individual and small group mkts. That said, what what percent of policies in N.C. are covered by BCBS? Anyway, believe it or not, we seem to share a hostility towards the Blues. I see them as rent-seekers, you see them as blood-suckers. We may both be right. But measures to bring in competitors would solve a lot of problems for you and me both. (Glad we agree on something.) Oh, and I’m not concerned about ERISA-exempt companies as much as the individual market, which is where the uninsured can or cannot get insurance. So when I’m talking about competition, I’m talking mainly about the individual and small group mkts. That said, what what percent of policies in N.C. are covered by BCBS? Anyway, believe it or not, we seem to share a hostility towards the Blues. I see them as rent-seekers, you see them as blood-suckers. We may both be right. But measures to bring in competitors would solve a lot of problems for you and me both. (Glad we agree on something.)

]]> By: Max http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6769 Max Wed, 12 Mar 2008 19:18:05 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6769 Didn't we just pass high risk pool legislation? I actually think this is a good thing, if it's paid out of the General Fund and not others' premiums. But if you force companies to pay for people with pre-existing conditions over 40, you guarantee another army of uninsured. And that's not what we want. So the high risk pool, is a reasonable option, I think. Don't you? As far as sparky's comments about universal healthcare being a fundamental right -- lemme know how the folks on the waiting lists in Britain and Canada are doing exercising such a right under the CCCP rationing system. Didn’t we just pass high risk pool legislation? I actually think this is a good thing, if it’s paid out of the General Fund and not others’ premiums. But if you force companies to pay for people with pre-existing conditions over 40, you guarantee another army of uninsured. And that’s not what we want. So the high risk pool, is a reasonable option, I think. Don’t you?

As far as sparky’s comments about universal healthcare being a fundamental right — lemme know how the folks on the waiting lists in Britain and Canada are doing exercising such a right under the CCCP rationing system.

]]> By: Adam Searing http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6747 Adam Searing Wed, 12 Mar 2008 01:49:17 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6747 This seems to me to be one of the most amazing idiocies of our health system - someone who works but can't afford coverage because they aren't under 40 and without a major health condition. That makes no sense - the market has failed and needs some serious regulation, starting with banning insurance companies from charging higher premiums based on preexisting conditions. This seems to me to be one of the most amazing idiocies of our health system – someone who works but can’t afford coverage because they aren’t under 40 and without a major health condition.

That makes no sense – the market has failed and needs some serious regulation, starting with banning insurance companies from charging higher premiums based on preexisting conditions.

]]> By: Sparky http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6745 Sparky Tue, 11 Mar 2008 23:35:39 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6745 WADR to Max above, competition won't help much with lowering premiums and increasing care. The way the industry is structured means that they have to give less care than they receive in premium dollars or other returns. What we really need is universal health care as a fundamental right, with no profits for shareholders. There is plenty of money in the health care industry-- but it's not taking better care of patients. It's taking better care of investors, execs and shareholders. And yes, I do have an axe to grind here. My self-employed sister, age 54, is in reasonably good health, but the price of her Blue insurance premium is so high she can't pay it. WADR to Max above, competition won’t help much with lowering premiums and increasing care. The way the industry is structured means that they have to give less care than they receive in premium dollars or other returns. What we really need is universal health care as a fundamental right, with no profits for shareholders. There is plenty of money in the health care industry– but it’s not taking better care of patients. It’s taking better care of investors, execs and shareholders.

And yes, I do have an axe to grind here. My self-employed sister, age 54, is in reasonably good health, but the price of her Blue insurance premium is so high she can’t pay it.

]]> By: Kinda Blue http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6740 Kinda Blue Tue, 11 Mar 2008 20:08:56 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6740 Blue Cross had a for profit subsidiary in the 80s called the Personal Care Plan, Inc. which was a no deductible, no co-insurance IPA-HMO. Tens of thousands of state employees signed up. Blue Cross had a for profit subsidiary in the 80s called the Personal Care Plan, Inc. which was a no deductible, no co-insurance IPA-HMO. Tens of thousands of state employees signed up.

]]> By: Adam Searing http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6713 Adam Searing Mon, 10 Mar 2008 21:16:29 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6713 Blue does compete directly with major out-of-state insurers for both big and small business accounts. With larger companies they are by no means a monopoly - other major out-of-state insurers have a large share of that market. Blue does compete directly with major out-of-state insurers for both big and small business accounts. With larger companies they are by no means a monopoly – other major out-of-state insurers have a large share of that market.

]]> By: Max http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6710 Max Mon, 10 Mar 2008 19:55:16 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6710 Some good points. But do you know what you do about a non-profit monopoly? You reduce the barriers to entry for competition. How do you reduce barriers to entry for competition? Get rid of state mandates and other costly regs, open the borders to out-of-state competitors, and then you don't worry about what they're charging -- because good competitors will beat them on price. Many of the 'progressive' policies you espouse prop up this healthcare monopoly because there is no room for competitors in this stifling regulatory environment. Just a thought. Some good points. But do you know what you do about a non-profit monopoly? You reduce the barriers to entry for competition. How do you reduce barriers to entry for competition? Get rid of state mandates and other costly regs, open the borders to out-of-state competitors, and then you don’t worry about what they’re charging — because good competitors will beat them on price. Many of the ‘progressive’ policies you espouse prop up this healthcare monopoly because there is no room for competitors in this stifling regulatory environment. Just a thought.

]]> By: Insurance » Blog Archive » What is NC Blue Cross up to with an extra $1.2 billion and a new for-profit subsidiary? http://pulse.ncpolicywatch.org/2008/03/10/what-is-nc-blue-cross-up-to-with-an-extra-12-billion-and-a-new-for-profit-subsidiary/#comment-6707 Insurance » Blog Archive » What is NC Blue Cross up to with an extra $1.2 billion and a new for-profit subsidiary? Mon, 10 Mar 2008 17:58:16 +0000 http://pulse.ncpolicywatch.org/?p=927#comment-6707 [...] my.IS - Lexus IS Forum just wrote an article aboutHere’s a preview of it: [...] [...] my.IS – Lexus IS Forum just wrote an article aboutHere’s a preview of it: [...]

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