Blue Cross merger: Area officials unconcerned about cost increase
By JENNIFER WILSON
News editor
On Monday, Blue Cross-Blue Shield of Kansas announced that a majority of its policyholders had voted in favor of merging with Indianapolis-based Anthem Insurance Companies, Inc.
But the vote wasn't exactly overwhelming: out of 63,504 voters, 63.4 percent gave the plan a 'yes' vote. Because of the number of voters, only a simple majority was needed to approve the conversion, according to BCBSKS.
The company next needs the approval of state insurance commissioner Kathleen Sebelius to complete the transaction.
Even with the proposed merger on the horizon, many organizations and individuals fear that the result will be higher premiums that many Kansans may not be able to afford.
But Hillsboro officials aren't overly concerned about a potential premium increase. They already plan for increases each year.
"Our rates will not be affected dramatically," said Steve Garrett, city administrator.
City employees are covered under Blue Cross of Kansas. The city pays for insurance for the employee, and the employee has the option to add additional coverage for a spouse or family member at an extra cost.
The city budget has already taken into account a potential premium increase for its fiscal year. It's something the city tries to prepare for each year, Garrett said.
Garrett is no stranger to dealing with skyrocketing insurance premiums. While at his former post in Stockton, insurance for city employees went up 35 percent, he said. The city's insurance was not through Blue Cross.
The challenge for Kansas cities is to keep anticipating costs so that employee benefits don't suffer, Garrett said.
"The reality is that money has to come from somewhere," he said. "We're not panicking."
Neither is the school district. USD 410 Superintendent Gordon Mohn doesn't anticipate any unforeseen premium increases from Blue Cross. The district already expects an increase of six to 11 percent per year, he said.
Currently, the Durham-Hillsboro-Lehigh school district is one of 30 schools receiving benefits from Blue Cross through a statewide education organization known as ESSDACK. Through this, USD 410 is partially self-insured.
Being partially self-insured gives the district more control over paying benefits, Mohn said.
"We have a good handle on things," he said.
For teachers and staff of the district, USD 410 pays the first $278 of insurance, which covers the basic level of insurance for a single person. Employees then have the option of purchasing more insurance to increase coverage, such as lowering their deductible, or adding a family member to the plan, Mohn said.
Blue Cross-Blue Shield of Kansas is pleased that policyholders voted in favor of the merger with Anthem.
"This affiliation will not only result in a huge infusion of money into the Kansas economy, but also is the best way to guarantee the continued existence of a strong, well-managed Blue Cross and Blue Shield company in Kansas," said John Knack, CEO of BCBSKS.
However, several organizations in Kansas have publicly voiced their opposition to the merger, including the Kansas Medical Society, the Kansas Hospital Association, and the Kansas State Nurses Association.
