Governor’s proposal for Blues speaks to a changed state, huge opportunity for Michigan (with infographic)

Lynda Rossi

| 4 min read

Executive Vice President for Strategy & Public Affai...

Blue Cross has long stood for its nonprofit mission of providing access to care, working to keep health care affordable, and improving both the quality of care and the health of Michigan’s residents. That’s the legacy we’ve honed over the 73 years since we wrote our first insurance policy. Over that time, the Blues have adapted our mission to meet the changing needs of our state. This is important, given that the needs of people change from decade to decade. Today, under a proposal announced by Gov. Rick Snyder, Michigan stands to benefit once again from a re-focusing of Blue Cross’ nonprofit mission. As part of the governor’s proposal to modernize Michigan’s regulatory system and transition BCBSM to a nonprofit mutual insurance company, Blue Cross would contribute $1.5 billion over the next 18 years to a separate nonprofit entity to improve health care in Michigan. That money would be aligned to our state’s needs and channeled to support vital public health initiatives. Structured appropriately, this nonprofit fund has the potential to make a huge difference for Michigan, where much has changed in the 32 years since Public Act 350, the law that today governs Blue Cross, was enacted.

Physical and economic health

Put plainly, Michigan has seen its collective health decline, both among its citizenry and economically, over three decades. The two are in many ways intertwined. As a nation, we spent nearly $2.6 trillion on health care in 2010, more than 10 times what we spent in 1980, according to the Centers for Medicare and Medicaid Services. Employer-sponsored coverage has increased in cost by 97 percent since 2002, with half of those expenses taken up by hospital care and physician or clinical services. Today, two thirds of all adults in Michigan, and 40 percent of children, are overweight or obese, making us the fifth heaviest state in the nation. As a result, we suffer high rates of heart disease, Type 2 diabetes and other chronic disease that contribute heavily to rising health care costs. Gov. Snyder estimates that chronic illnesses tied to obesity will contribute $12.5 billion in unnecessary health care spending by 2018. What’s more, employees in poor health miss work more often than healthy workers, driving down productivity and adding to health care costs for employers. Meanwhile, Michigan is slowly emerging from a long, difficult recession that saw the state lose jobs each year between 2000 and 2011.

How the governor’s proposal can help

While details of the $1.5 billion contribution have yet to be finalized, we expect it will fund programs that help children and seniors, improve patient safety, clinical quality and patient outcomes, and rein in costs. Ideally, it would contain specific standards and metrics established to ensure positive outcomes. It could also be used to establish a trust that earns investment income over time to benefit future generations of Michigan residents. The $1.5 billion is roughly 25 times more than any other nonprofit Blue plan has contributed when transitioning to a nonprofit mutual. This gives Michigan an unprecedented opportunity to invest in key health care priorities for our people: expand access to care, make it more affordable, improve clinical quality, and help residents become healthier. Blue Cross has advocated for changes to Michigan’s regulatory system for more than six years. The health insurance industry and health care itself have changed dramatically over time, and the system put in place more than 30 years ago is no longer working. Along with changes being ushered by the Affordable Care Act, Gov. Snyder’s proposal would at long last put all insurers on level ground, operating by the same rules. The governor’s plan preserves best of Blue Cross while making our mission right for the times we live in today, and for the future. We look forward to continuing to make positive and significant contributions, as a Michigan-based company, to create a healthier future for our state. View the full infographic. Lynda Rossi is senior vice president, Public Affairs and chief of staff for Blue Cross Blue Shield of Michigan.
MI Blues Perspectives is sponsored by Blue Cross Blue Shield of Michigan, a nonprofit, independent licensee of the Blue Cross Blue Shield Association