Nonprofit Blues Plans Have Amassed Huge Surpluses: Report

In the last decade, nonprofit Blue Cross and Blue Shield (BCBS) plans have set aside billions of dollars in surplus, even as they raised rates for many customers, according to a widely publicized report issued by the nonprofit group Consumers Union. Nonprofit BCBS plans, including community-owned charitable plans and subscriber-owned mutual plans, held more than $32 billion in surplus at the end of 2008.

In researchers’ sampling of 10 nonprofit BCBS plans, seven held more than three times the amount of surplus that regulators consider to be the minimum amount needed for solvency protection. For example, BCBS of Arizona has surplus more than seven times the regulatory minimum as of the end of 2009. Health Care Service Corporation, a mutual insurer doing business as BCBS of Texas, Illinois, New Mexico and Oklahoma, has five times the regulatory minimum. Meanwhile, over the past three years both insurers continued to raise their rates.

The report calls on state insurance regulators to scrutinize surpluses when considering rate increases and set maximum limits for surpluses. 

CMS Issues Fact Sheets on Meaningful Use Provisions for EHR

The Centers for Medicare & Medicaid Services has issued three fact sheets related to the final rule to implement provisions of the American Recovery and Reinvestment Act of 2009 that provide incentive payments for the meaningful use of certified electronic health records (EHR) technology. The Medicare EHR incentive program will provide incentive payments to:

  • Eligible professionals, eligible hospitals, and critical access hospitals that are meaningful users of certified EHR technology
  • Eligible professionals and hospitals for efforts to adopt, implement, upgrade, or demonstrate meaningful use the technology

The fact sheets summarize:

  • CMS’s final definition of meaningful use 
  • Requirements for the Medicare EHR incentive program 
  • Provisions in the final rule that affect state Medicaid programs and Medicaid providers