Blues sing the Blues
Cudos to Atty. Gen. Mike Cox for holding Blue Cross/Blue Shield CEO Dan Loepp's feet the the fire over the Blues' brazen attempt to use their special tax-free status as a so-called "not for profit" insurer to buy up yet another for-profit subsidiary.
It helps, of course, that Cox is a Republican testing the waters for a run at the term-limited Michigan governor's job two years from now and Loepp, a career political flack who landed the BC/BS job through his Lansing connections, spent a large part of his public life as chief of staff to former Michigan House Speaker, Democrat Curtis Hertel.
No love lost on either side there.
The Blues were formed originally in 1980 to be the "insurer of last resort" for folks who couldn't get other health care coverage for one reason or another. As part of the deal to take everybody, Lansing granted the Blues corporation an exemption from state taxes.
The Blues, of course, made a ton of profit anyway. But in order to keep their bottom line looking thin so they could retain their tax-free ride, in 1993 they worked out a deal to branch out into a for-profit sideline - the Accident Fund.
Now under Loepp, with the support of a Democrat-controlled Michigan House, they're at it again, pushing a piece of so-called "reform legislation" (over Cox's objections) that will let them branch out even further into another money-making venture while maintaining the BC/BS basic tax-free status to fund the purchase.
What's really galling Cox and others is that in order to steer pubic opinion support to their brash money grab, the Blues keep using their tax-free profits (the Blues admit to $2.4 billion in reserves) to fund a radio and TV ad blitz to brag about how the poor little Blues have been losing money insuring otherwise uninsurable Michiganians for dozens of years and aren't they just the nicest people?
No mention of the fact that they aren't doing it out of any sense of charity toward those unfortunate uninsurables. They have to insure them or end their free load and risk losing their posh executive salaries and perks.
