Bills Would Make Michigan Blue and Should Make You See Red

House Bills 5284 and 5285 turn Blue Cross, a non-profit charity, into a for-profit holding company using tax-free dollars. Policy holders stuck with with back-breaking rate increases.

Got the Blues? If you're a Michigan resident, there's a good chance you do. Blue Cross Blue Shield of Michigan has become a dominant player in the state's health benefit market. The Blues covers 70 percent of the market — making about $1 million a day in profits through a special status given to it by the Michigan Legislature. Under state law, the Blues are a charitable, benevolent and non-profit organization that does not pay state or local taxes.  Those tax breaks amounted to over $ 120 million last year.

In return, they are supposed to make sure that health care coverage is available to everyone, regardless of health status. They've used their unique status to create a near monopoly position, and amass almost $3 billion in reserves.

Apparently, that's no longer enough. Now they want even more.

House Bill 5284: Creating a Bluesopoly
Less Competition = High Prices

Blue Cross Blue Shield drafted a package of bills that it is lobbying the Legislature to pass. Under HB 5284, the Blues would be able to use its reserves, built up at the expense of its subscribers and Michigan taxpayers, to dabble in any business it chooses, anywhere in the world. The Blues could buy hospitals, sub-prime mortgage companies, for-profit insurance companies, check cashing franchises, casinos – the sky’s the limit. Nothing in the bill would require the Blues to use its billions to reduce the cost of health care benefits.

In no time at all, it would become the first for-profit, not-for-profit, tax-exempt Bluesopoly. We all know that monopolies are bad. Once established, the alternative sources of competition are crushed. After that is accomplished, the monopolists can do whatever they want. Who's to stop them from raising rates? What about competition? What about lost job

House Bill 5285: Yet Another Way to Expand
Leveraging Tax-free dollars to expand the Monopoly

In the early 1990s, the Blues asked for changes to its statute to allow it to buy the Accident Fund from the State of Michigan. At the time, the Legislature and the Governor were concerned about this move away from its core mission of guaranteeing access to health benefits. They asked for, and the Blues agreed to, certain safeguards, one of which was restricting the Accident Fund to selling only workers compensation insurance.

Now Blue Cross Blue Shield wants to renege on that agreement. It wasn’t enough to use hundreds of millions of subscriber dollars to buy the Accident Fund in the first place. The Blues now want to leverage its market power with tax free dollars – gained at the expense of both subscribers and taxpayers -- to begin offering auto, homeowners and business insurance through the Accident Fund.

Does this sound like an organization with a charitable and benevolent mission?

Stop the Blues Bills today. Contact your legislator and send a note to your state legislator that Michigan consumers can’t afford the Blues’ Bills.