Pennsylvania Legislators take Nonprofit Health Insurers to Task

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July 24, 2011; Source: Publication | A dozen legislators from southwestern Pennsylvania held a news conference last Thursday calling on nonprofit health insurers to put the health of the community before their own corporate agendas. In particular the lawmakers appear to be upset with the fact that Highmark Blue Cross Blue Shield has built up more than $3.9 billion in surplus while raising rates and “empire building.” In fact, the company is currently requesting a rate increase for "Special Care" health insurance, described here as “the policy of last resort for low-income Pennsylvanians since the state cut off its low-cost adultBasic coverage in February. The hike would cost roughly $150 a year more for those who already are hanging on by their fingernails.”

There is a lot more to this story, just as there is to all of the stories about nonprofit health insurers unfolding across the country, and involving as they do unsupportable levels of reserves, high compensation packages for execs and boards and rate increases that far exceed the rate of inflation. This article’s author is pretty up front in her conclusions: “Somehow, the stalemate has to be broken. When lawmakers hold their hearings to look for "legislative solutions," here's one that should be on the table: If these companies cannot act in good faith and the public interest, they should be stripped of their nonprofit status and start paying taxes like the other profit-making corporations in this town. That would get their attention.”

NPQ has been and will be pursuing this national story aggressively in the future. Watch these pages. – Ruth McCambridge