Pennsylvania Insurance Commissioner Says BCBS Plans’ Surpluses Not Excessive

Pennsylvania's four not-for-profit Blue Cross Blue Shield plans do not have "inefficient" or "excessive" surpluses, state Insurance Commissioner M. Diane Koken said on Wednesday, the Philadelphia Inquirer reports. In response to criticism from consumer advocates, the insurance department examined the finances of Independence, which reported an $841 million surplus; Highmark, with a $2.2 billion surplus; Capital, with a $516 million surplus; and Northeastern, with a $405 million surplus. Consumer advocates have accused the BCBS plans of maintaining excessive surpluses for more than three years at the cost of higher premiums, and some beneficiaries have filed lawsuits related to the allegations. However, Koken said her examination showed that the plans "are not operating with inefficient or excess surplus," adding that Independence's surplus was "efficient" and could increase, while the other Blues had "sufficient" surpluses that should stay at current levels. Koken said there was no connection between the insurance department's findings and an agreement between the insurers and Gov. Ed Rendell (D) signed this week. Under the agreement, the BCBS plans promised to spend $1 billion over six years to provide low-cost health insurance to low-income state residents. Consumer groups said Koken's claim is "impossible to believe," the Inquirer reports. According to the Inquirer, "the fight over the Blue's surpluses is unlikely to end," despite Koken's ruling (Goldstein, Philadelphia Inquirer, 2/10).