Health
2:26 pm
Thu February 28, 2013

Blue Cross overhaul closer to Gov. Snyder's desk

The Michigan House passed SB 61 and SB 62 today on a 92-18 vote. The bills go back to the Senate for a concurrence vote, and then they'll head to Gov. Snyder's desk for his signature.

The bills are aimed at overhauling how Blue Cross Blue Shield of Michigan operates in the state.

Similar bills were attempted in the last session of the legislature, but they contained controversial abortion language. The language required an optional rider for abortion coverage.

Gov. Snyder vetoed those bills.

These new bills don't have the abortion language.

More on the changes from MLive's Melissa Anders:

The bills allow Detroit-based Blue Cross to become a nonprofit mutual insurer, a structure that would allow it to more easily and quickly change rates.

Blue Cross has been exempt from paying state and local taxes because it offers coverage to people with pre-existing conditions. But that won’t be necessary starting January 2014, when the Affordable Care Act will require all insurers to offer coverage to everyone, regardless of health status.

Under changes recommended by Snyder, Blue Cross would be required to pay taxes and contribute up to $1.56 billion over 18 years into a separate nonprofit charged with continuing the insurer’s charitable mission.

State Attorney General Bill Schuette opposes the changes. In a statement, Schuette  said he's concerned the changes to Blue Cross would have "negative impacts on hundreds of thousands of Michigan seniors who rely upon Blue Cross for Medigap coverage."

The Blue Cross Medigap plans cover costs not covered by a senior's Medicare coverage.

From his statement:

"When the existing Medigap rate freeze ends in 2016, hundreds of thousands of Michigan seniors will either face higher rates or be left on their own to find new coverage if Blue Cross drops the Medigap plans.  That is unacceptable, and as a result, I cannot support the legislation."


Anders reports the new legislation requires the new BCBSM to subsidize Medigap rates for seniors through the end of 2021. Schuette says the amount dedicated to the Medigap subsidy isn't enough.