In a stunning decision delivered last week with no explanation, California’s Department of Managed Health Care agreed with Blue Shield of California that the nonprofit has no duty to operate for the benefit of the community.
Blue Shield’s plan for the Care 1st acquisition would subordinate the interests of Medi-Cal enrollees to privately-insured enrollees, according to legal documents filed with regulators.
Nonprofit Blue Shield is planning to include in its Obamacare rates for next year the highest profit and administrative expense margin of any California health insurer.
Leon Panetta said he joined the board of Blue Shield because it is nonprofit and serves the “welfare of the entire community.” If he meant what he said, he needs to bring management into line.
Blue Shield, which made headlines yesterday with its lavish and secretive compensation of top executives, is accused in a class action lawsuit of failing to pay its lowest-paid workers their full wages.
In 2013, while working for Blue Shield of California, I learned that Bruce Bodaken, who’d resigned the previous year as CEO, was paid $20 million when he left.
Blue Shield spent just 72% of Obamacare premiums on medical care in 2014, with the rest going to profits and administrative expenses.
Blue Shield must pay rebates of over $100 per enrollee and hand over to the government $93 million in excess profits because it overcharged for Obamacare coverage in 2014.
In a message to employees, Blue Shield CEO Paul Markovich laughed off a front-page LA Times article detailing blistering criticism of the nonprofit by California authorities who revoked its tax exemption.
The disclosures in yesterday’s front-page Los Angeles Times article on the tax audit of Blue Shield make clear the need for a full-scale investigation by health plan regulators of Blue Shield’s conduct as a nonprofit.
Blue Shield should either act like a nonprofit and provide benefits to the public worth 5% of its assets or formally convert to for-profit status and relinquish its nonprofit assets to a public benefit foundation.
The Department of Managed Health Care announced yesterday that it would conduct an examination of Blue Shield’s "charitable trust" obligation, or duty to work for public benefit.
In statements to health plan regulators that it has no legal duty to operate for public benefit, Blue Shield contradicted what it had told state tax authorities during an audit of its tax exemption.
Blue Shield has structured its pending acquisition of Care 1st so that despite the recent revocation of its tax exemption it would escape state and federal taxes on its new business.
A major Blue Shield IT contractor “tried to bribe [a Blue Shield IT executive] with sex clubs and prostitutes,” according to a wrongful termination lawsuit by a former Blue Shield IT executive.
California regulators announced that they'll hold a public hearing on Blue Shield’s proposed acquisition of Care 1st Health Plan. A coalition of consumer groups and I had requested the hearing.
The revocation of Blue Shield's tax exemption made big news. But even more important is what happens with the $10 billion in nonprofit assets that the insurer will continue to hold.
Blue Shield is overpaying favored information technology vendors by millions of dollars, according to a lawsuit by a former Blue Shield vice president.
Blue Shield has built a stockpile of $4.2 billion in retained profits--far more than it needs in reserves to guarantee payment of claims. But it refuses to use the excess to lower rates.
Since Blue Shield is a nonprofit, which means it is effectively owned by the public, regulators should hold a public hearing before approving management's use of nonprofit assets to acquire another health plan.