Insurance Rivals Go At It

January 17, 2008
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GRAND RAPIDS — As the date grows closer for public debate in the state Senate over reform to the individual health insurance market, West Michigan’s two largest insurers are squaring off in opposite corners.

Priority Health announced Wednesday that its executives intend to testify before the  Senate’s Health Policy Committee later this month against a four-bill package of bills supported by Blue Cross Blue Shield of Michigan. Two of the bills are aimed at changes in the individual market, and two would permit a BCBSM for-profit worker’s compensation subsidiary to sell additional types of insurance.

Priority Health’s strongest objection is to a provision that would require every insurer to pay into a pool intended to offset losses that Blue Cross incurs from covering people who can’t get insurance elsewhere. State law requires the nonprofit Blue Cross to be the insurer of last resort. 

“They get the benefit of having the member, but the losses they sustain would be subsidized by other, competing carriers,” Bilardello said. “The trouble with that is when we price our products, we not only have to price with own risks, we have to add more because we have to fund losses that Blue Cross might have. That’s the biggest issue we have with it.”

BSBCM spokeswoman Helen Stojic criticized Priority Health as being unwilling to aid the state’s sickest people, who may have been rejected by other insurers or faced dramatic prices hikes because of the illness, and so much turn to the state’s insurer of last resort.

“We think these common sense reforms will benefit Michigan consumers and promote the long-term affordability of coverage in Michigan,” Stojic said.

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