Michigan Attorney General Says Lawmakers Should Not Pass Health Insurance Legislation In Lame-Duck Session

Main Category: Health Insurance / Medical Insurance
Article Date: 21 Nov 2008 - 10:00 PST

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Michigan Attorney General Mike Cox (R) and consumer advocates on Tuesday asked the state Legislature to abandon plans to approve legislation in the upcoming lame-duck session that would allow Blue Cross Blue Shield of Michigan, the state's insurer of last resort, to restructure, the Detroit Free Press reports (Bell, Detroit Free Press, 11/18). Michigan lawmakers are working to consolidate two versions of the legislation, one approved last year by the state House and another approved in the spring by the state Senate (Rogers, Detroit News, 11/19).

Blue Cross officials say the legislation is needed because the company is experiencing unsustainable losses in the individual health insurance market. The company says that under current regulations, it must pay for hundreds of millions of dollars annually in uncompensated care. Blue Cross also seeks to increase its non-health insurance business through its Accident Fund subsidiary (Detroit Free Press, 11/18).

Cox, along with representatives from AARP and the Consumers Union, said that the legislation would increase costs for people who purchase individual health policies and allow the insurer to deny coverage for people with pre-existing health conditions (Detroit News, 11/19). In addition, Cox said the bill would allow the insurer to increase premium rates for individual policies without oversight from the attorney general's office or the state insurance commissioner (Detroit Free Press, 11/19).

Blue Cross spokesperson Andrew Hetzel said Cox's understanding of the legislation and a draft compromise bill that is being circulated among lawmakers is dated, the Detroit News reports. He said that the compromise package would continue state oversight of premium rate changes, as well as add consumer protections and require health insurers that reject people or deny coverage to pay into a fund that would be used to help keep insurance affordable (Detroit News, 11/19).

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