Mitch Crane Speaks Out on BCBSD-Highmark

Mitch Crane, the progressive Democratic candidate for Insurance Commissioner, issued a press release yesterday regarding KWS’s turning her back once again on the people of Delaware by approving the merger of Blue Cross Blue Shield of Delaware and Highmark.

“This is a bad decision for Delaware. Once again this Insurance Commissioner has put the interests of the insurance industry before the interests of the insurance consumers and all Delawareans.”

Crane, who served as Acting Director of Consumer Services & Investigations for the IC until last January, agreed with only one thing the corporate shill that is our Insurance Commissioner did – prohibiting the use of BCBSD’s reserves for the purchase of West Allegheny Medical System.

Crane went on to harken the advice the Lt. Governor (and former Insurance Commissioner) Matt Denn requiring Highmark to subsidize the cost of CHIP.

I agree with the Lt. Governor and former Insurance Commissioner, Matt Denn, that requiring Highmark to subsidize the children’s health insurance program and charge the same reduced premium in Delaware that it is charging in Pennsylvania is good for children and their families. However, this requirement is merely in compliance with the original affiliation agreement which was violated when BCBSD filed its rate requests.

Crane also slammed KWS for her “reasoning” to allow this merger to proceed.

It should be noted that while the reason given for this merger was to improve BCBSD’s ability to compete, BCBS is already quite competitive in Delaware. In fact, according to a 2007 study by the American Medical Association, BCBSD controls a majority of the market in Delaware. This affiliation / merger, combined with BCBSD’s tax exempt status, will only help BCSBD / Highmark further increase their market share and squash competition, thereby eventually driving up premium rates for Delawareans, and that is not good for the insurance consumer.

The rate stabilization subsidy meant to ‘reduce the rate of premium growth for individual and small group subscribers’ and the agreement with Blue Cross to maintain employment and charitable giving levels do not exist after four years. After four years, therefore, consumers can expect their premiums to go up and BCBSD will have the right to begin laying off workers. This four year agreement may be good public relations but it is not good public policy. We need a long term solution to deal with the out-of-control premium increases paid by consumers, not a four year band aid.

Finally, the Order leaves the Department of Insurance with no ability to dissolve the merger if Highmark does not live up to the agreement. Instead, only BCBSD’s “Class A Board of Directors” (whose members will be hand-picked by Highmark) have the ability to disaffiliate if Highmark reneges on its obligations and that is a bad decision for Delaware.

Crane is the only person running for Insurance Commissioner that has advocated for the consumer. “Putting the Consumer First” is his campaign slogan, and he means it. We’ve covered the questionable actions by KWS since she took office, and the questionable actions by her hired gun Elliott Jacobson. And she has a registered Republican as her campaign manager. Well, he was a registered Republican up until three weeks ago. ‘Nuff said.