North Dakota Scandal Raises Concerns About Health Co-op Route

[godai]

For the North Dakota insurance sales reps, March may have been the ideal time to enjoy the swim-up bar at a resort on Grand Cayman Island. But back on the northern Plains, where temperatures were below zero, policyholders at Blue Cross Blue Shield of North Dakota were less delighted when they learned about the trip for 66 staff members and guests.

Word of the $238,000 Caribbean retreat broke last winter, compounded by news of other perks: $15 million in executive bonuses over five years, $400,000 for charter flights and $35,000 for a vice president's retirement party. And when the ensuing uproar cost Michael Unhjem his job as chief executive, his landing was softened by a $2.5 million severance payment. The golden parachute had been added to his contract after his 2006 drunken-driving arrest, a state audit pointed out.

"Call it cooperative, call it mutual, call it private insurance," said Don Morrison, executive director of NDpeople.org. "If what we want is to have quality health care at a price people can afford, it's not coming from the culture of private insurance. If this is a model, let's get real."

For the Blues, which have common roots in the cooperative model, controversies over executive compensation have not been limited to North Dakota. Maryland's insurance commissioner halved an $18 million severance payout last year for the chief executive of CareFirst Blue Cross Blue Shield, calling it "simply too much money to pay the departing CEO of a nonprofit company."

In Massachusetts, where residents are required to carry health insurance, the attorney general last month launched an inquiry into executive and board compensation at health-care nonprofits after the chairman of the state's Blue Cross Blue Shield retired with a $16 million lump sum.

In North Dakota, which has a $1 billion state budget surplus, residents wear their parsimony proudly. And all of the spending excesses, said state Insurance Commissioner Adam Hamm, came roughly at the time the company was seeking premium increases of 15 to 20 percent.


http://www.washingtonpost.com/wp-dyn/content/article/2009/10/09/AR2009100904085.html

[joeycola]

1. "the company was seeking premium increases of 15 to 20 percent."--they

have no shame. just greed.

[thunder rising]

2. Consider the population of ND is 641,999. That's a lot of milk money stolen from the pockets of kids

[Traveling_Home]

3. But it's a "health-care nonprofit" .......

so it isn't the profit motive that stopping these NONPROFITS from proving better services.