"Plans in 10 states.... held more than $32 billion in surplus at the end of 2008.... built primarily with customers’ premium dollars"
"Report questions Blue Cross surplus; Insurer says HMO not counted" by Robert Weisman, Globe Staff | July 22, 2010
Blue Cross Blue Shield of Massachusetts, which has been seeking higher health insurance premiums from customers, amassed a surplus of $723.8 million at the end of 2009, more than 3 1/2 times the amount required by regulators for solvency protection, according to a report scheduled to be released today.
The report by Consumers Union, an independent research and educational group, shows that nonprofit Blue Cross Blue Shield plans across the country set aside billions of dollars in surpluses over the past decade at the same time they consistently raised premium rates, sometimes by double-digits in a single year.
Such increases might have been avoided or moderated if the insurance companies used some of their reserves to stabilize rates, the report said. It recommended that regulators consider surpluses as part of their rate reviews and reject hikes from insurers with excessive reserves, a practice Massachusetts officials say they already embrace.
A reserve is the excess of an insurance carrier’s assets over its liabilities. The money is intended to protect insurers and policy holders from financial losses in the event that medical emergencies result in unexpectedly high bills from health care providers. States set their own surplus levels, but Blue Cross Blue Shield plans typically keep more cash on reserve than is required....
Laurie Sobel, senior attorney for Consumers Union in San Francisco and coauthor of the report, said in an interview: “Consumers are really struggling right now, and the Blue Cross health plans are sitting on a lot of money.’’
But Tara Murray, a spokeswoman for Blue Cross Blue Shield of Massachusetts, said the numbers cited in the report are misleading because they do not include the carrier’s subsidiary, Blue Cross Blue Shield of Massachusetts HMO Blue, which sells policies separately from its parent company. The report’s authors acknowledged the subsidiary in a footnote.
When the subsidiary is included, the insurer’s surplus was $1.4 billion at the end of last year, according to Murray. But....
We can't afford health care for you, low-wage workers.
Murray did not dispute that the insurer, like other Blue Cross Blue Shield plans around the nation, keeps a higher surplus than what the state requires. She said the reserve level is prudent given the uncertainties of health care....
Any excuse to roll in loot, 'eh?
In a report released in May, the state Division of Health Care Finance and Policy said the total surplus of eight Massachusetts health insurance carriers has climbed fourfold since 1999, to $2.5 billion....
Sobel, coauthor of the Consumer Union report, said her organization focused on Blue Cross Blue Shield plans because they dominate the health insurance market in most states. The report examined plans in 10 states, including Massachusetts, and found they held more than $32 billion in surplus at the end of 2008.
“Those surplus funds are built primarily with customers’ premium dollars....’’ the report said.
Rather than sitting on them they can shove them up their....
And then deny themselves health care.
--more--"
The Massachusetts Model: Blue Cross Drops Its Shield
Yeah, they need that money for other things.
And the industry has the NERVE to CRY POVERTY?
"Insurer losses triggered most intervention in a decade" by Andrew Frye, Bloomberg News | July 20, 2010
NEW YORK — Life and health insurers were subjected to regulatory intervention last year at the fastest pace in a decade as they lost money on investments and promised more to clients than they could deliver.
We call that lying here.
The industry “has yet to fully shake off some of the lingering effects of the financial crisis,’’ Carole Ann King and Joe Niedzielski, analysts with the insurance company ratings firm A.M. Best, said in a report released yesterday....
Meanwhile, Americans are prostrate on the floor.
The biggest life insurers, led by MetLife Inc. and then Prudential Financial Inc., reported quarterly losses exceeding $1 billion during the credit crisis. Investments soured during the recession, and guarantees made to policyholders weighed on results when stock markets declined. Even after profits returned to many carriers last year, Fitch Ratings warned of losses to come on commercial mortgages....
State insurance regulators are responsible for monitoring carriers’ finances and ensuring companies have enough money to satisfy claims. The watchdogs are backed up by state guaranty funds, which are supported by solvent insurers and pay claims when regulated carriers can’t meet obligations.
You seem to have EVERYONE'S BACK, taxpayers!
So WHO has YOURS?
Life and health insurers reported net income of $21.3 billion last year, compared with a loss of almost $53 billion in 2008 as investment write-downs narrowed, A.M. Best said....
Thanks for the BAILOUT and taking the crap off our books, taxpayers!
