ACHE in the news

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The following article appeared in slightly varying formats in The Montana Standard, the Billings Gazette, and the Missoulian.
By CHARLES S. JOHNSON
Gazette State Bureau
HELENA - A new group called Allied Citizens for Health-Care Equity, or ACHE, surfaced Tuesday, and its executive director accused Blue Cross and Blue Shield of Montana of having "a hammerlock" on Montanans and blocking out competition.

"Lack of real competition in any arena guarantees two things: high prices and poor services," ACHE's executive director, Susan Good, an ex-Great Falls legislator and former chairwoman of the Montana Republican Party, told a press conference.

Good, citing figures from the state insurance commissioner's office, said Blue Cross and Blue Shield of Montana had 44.39 percent of the insurance market share in Montana in 1998 and wrote $238.9 million in premiums.

She said ACHE formed to protect consumers from business practices of some insurers that make it difficult for Montana citizens to get the quality health care they deserve.
Good said the new group has a $150,000 annual budget, but she refused to disclose its financial backers, saying they are doctors who fear retribution by Blue Cross and Blue Shield and potentially some insurers. She did list three people involved with the ACHE: Greg Lind, a Missoula anesthesiologist; Sen. B.F. "Chris" Christiaens, D-Great Falls, and Arla Jean Murray, a Miles City rancher.

In response, Chuck Butler, vice president for governmental and public relations for Blue Cross and Blue Shield of Montana, took exception to Good's allegations.

"The best overseers of how we conduct our business are the people we serve and our regulator (the state insurance commissioner)," he said. "There's lots of competition in the state of Montana. It's almost too hard to believe that anybody's whose interested in the well-being of the state of Montana and our economy would have a problem with an organization that's successful and provides good jobs to over 1,000 people in the state."

Part of the dispute between backers of ACHE and Blue Cross dates back to House Bill 607, by Rep. Loren Soft, R-Billings, in the 1999 session. It passed, but only after a key provision was deleted that would have made health-care insurers, including health maintenance organizations (HMOs), legally liable for health decisions made for patients.

Good lobbied at the Legislature for separate groups of Montana anesthesiologists, neurosurgeons, orthopedic surgeons and ear and eye doctors that favored keeping the liability section, while Blue Cross and other insurers convinced lawmakers to delete it.

She said these insurers warned that the passage of the bill with the liability section would lead to higher insurance premiums for customers and spur a flood of lawsuits, but neither occurred in Texas, the only state with such a law.

Butler responded by saying lawmakers ejected the liability section of HB607 not just because Blue Cross and Blue Shield opposed it but because a number of doctors also did, as well as Gov. Marc Racicot and a number of businesses.

He said Good over the years has been a strong critic of managed care, which he believes led her to form ACHE.

"It's unfortunate that some people really don't like managed care, and this is their way of dealing with it because managed-care health plans really do provide quality care," Butler said. "The medical services are provided by physicians, and they set the medical policy."
Good said ACHE may mount an initiative drive to put the deleted liability section before voters in 2000.

The ACHE director also called for imposing the state's insurance tax of 2.75 percent against the $238.9 million in premiums Blue Cross and Blue Shield wrote in 1998, raising $6 million in additional state revenue. Other insurers pay the tax, except for Blue Cross and another firm that are organized as nonprofit health-care companies.

Replied Butler: "By statute, we don't pay the premium tax. It is a sales tax, plain and simple. If a family pays $5,000 a year in premium, they would pay another $140 in premium tax. All of that is an issue for the Legislature to determine. Do they want to tax an entity that doesn't make money all of the time?"

He said Blue Cross and Blue Shield is classified as a nonprofit health insurance company because it has no stockholders and pays no dividends, unlike its commercial competitors.
Good also criticized Blue Cross and Blue Shield for having 363 pending complaints filed against it by consumers with the state insurance commissioner's office.

"We at ACHE want to help people who have paid their premiums faithfully, believing that they would be protected when they need it, only to be denied when they become sick," she said.

In response, Butler said Blue Cross and Blue Shield processes more than two million claims annually and serve nearly 500,000 Montanans through health insurance plans or Medicare claims. The complaints alleged by Good represent "a small fraction" of the claims handled, he said.

"When we make a mistake or an error, we apologize, we express our regret, we say we're sorry," he said. "If people are dissatisfied with the service they get or the prices they pay, there other people and businesses from which they can buy their insurance from. What's the problem here?"

She also criticized as excessive Blue Cross and Blue Shield giving some of their top officials 30-40 percent increases in total compensation from 1997 to 1998. For example, Chief Executive Officer Alan Cain saw his total compensation rise by 42.7 percent, from $292,425 in 1997 ($249,050 in salary, no bonus and $43,375 in other compensation, which is accrued sick days and unused vacation time) to $417,231 in 1998 ($294,616 in salary, $62,502 in bonus and $60,113 in accrued sick days and unused vacation time).
Butler said all of the top officers of the company except for its medical director have been with the company for at least 15 years.

"All of us have opportunities to leave Montana to earn substantially more," Butler said. "We compete for management-level people all over the United States. The salaries we pay are still among the lowest level nationally (for those jobs)
"We certainly earn every nickel we get. We provide good jobs for thousands of people. If some organization is upset that a company does well and has over 700 employees, what's wrong with this picture here?"

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