Excess health funds could aid uninsured

The huge surplus incurred by the state’s only nonprofit insurance company could be relocated into a trust fund to benefit uninsured citizens who do not qualify for Medicaid.

In response to concerns he heard on the campaign trail, Rep. Bill Faison, D-Caswell, filed a bill Thursday that would require Blue Cross Blue Shield of North Carolina to pay a percentage of its surplus to a state fund that would provide medical care for the uninsured.

Faison said he saw a discrepancy between the enormous reserves Blue Cross reports, which now exceed $865 million in capital and surplus, and its increasingly higher fees. Even insured people feared that they soon would not be able to afford insurance coverage because rates have risen by so much each year, he said.

The minimum reserve for Blue Cross is set at $93 million by the N.C. Department of Insurance. For the company to operate without close scrutiny, it would need twice that amount in the bank: $186 million.

But Blue Cross’ balance of $865 million is far beyond the minimum required reserve, Faison said.

“We don’t want them weak,” he said. “We just don’t want them greedy.”

Faison said a reserve of 650 percent of the minimum would allow Blue Cross to remain fiscally healthy and stable.

Any money over that threshold would be handed over to the state treasurer. The N.C. Department of Health and Human Services then would create a health care plan and present it to the legislature for review.

“It would generate about $270 million this year to be applied toward the health care costs of the people who can least afford it,” Faison said.

Bob Greczyn, president and chief executive officer of Blue Cross Blue Shield of North Carolina, stated in a press release that the bill would undermine the company’s financial stability and would benefit political agendas rather than customers’ health care needs.

“We do not believe politicians should put our members at risk by commandeering our reserves to pay for government programs,” Greczyn stated in the release.

But Chrissy Pearson, spokeswoman for the N.C. Department of Insurance, said customers made complaints — similar to those heard by Faison — to the department about insurance costs.

“We are very pleased that there are folks in the legislature that are taking actions to address that problem,” Pearson said.

Proponents of the bill say the consequences of having so many uninsured people reach every aspect of health care. Insurance premiums increase and co-payment costs skyrocket, which detracts from resources put toward medical staff.

And when uninsured people are in dire need of medical care, they end up in hospital emergency rooms.

Karen McCall, vice president of public affairs and marketing for UNC Health Care, said UNC Hospitals wrote off about $135 million last year in costs of treating the uninsured.

“Right now we have to be able to make sufficient money to be able to buy capital to be able to pay for employees,” McCall said.

“When we have such a tremendous burden of the uninsured, it makes it very difficult.”

Contact the State & National Editor at stntdesk@unc.edu.