July 20, 2011; Source: The News Journal | On the eve of possibly merging with Highmark, Inc., another insurer, Blue Shield of Delaware has been ordered to establish a charitable foundation to serve the health concerns of needy Delawareans with a portion of its $181 million in reserves. That level of reserves is 10 times the amount required by the state and three times the level recommended by the national Blue Cross Blue Shield Association. It is also a 48 percent increase from 2008. Still the insurer just sought rate increases as high as 17 percent for the individual market.
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This article reports that excess capital at Blue cross Blue Shield programs nationwide is at $29 billion, up from $18 billion in 2008. The NPQ Newswire has been following a series of reports of excesses both in terms of reserves and compensation on the part of nonprofit insurers nationwide.—Ruth McCambridge