Guest columnist
Premera's for-profit conversion unnecessary, unwise

By Kathleen O'Connor
Special to The Times

Kathleen O'Connor

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If you look at newspapers around the state, you'll see large ads about how Premera Blue Cross' proposed conversion to a for-profit company and establishment of two new charitable foundations with $500 million in assets will really make our state a healthier place.

I beg to disagree.

We need this conversion like we need another earthquake.

Look at what Premera has done in the past 12 months alone:

• Dropped its Medicaid and Basic Health Plan lines of business and turned them over to Molina Healthcare, a for-profit health plan headquartered in California;

• Quit processing some Medicare claims;

• Was threatened with termination by Providence Health Care in Eastern Washington (and they're still in hardball negotiations);

• And had a bitter negotiation battle with Multicare Health System in Pierce County that worked out, but had another bitter negotiation with state employees that did not.

Local company with local interests, as its CEO is fond of saying? This is hardly Mister Rogers. And if the company is not willing to negotiate acceptable rates with a group as large as the state employees, whom will it negotiate with?

Premera leadership says these negotiations and coverage decisions are unrelated. Perhaps so. But perhaps what they are related to is making more profit so Premera can pour more Washington and Alaska dollars into LifeWise Health Plan of Arizona, a Premera subsidy that is now offering its first line of health insurance in Arizona.

In its first 2002 filing with Arizona's Office of Insurance, LifeWise listed assets of $10.5 million. Where did that money come from? More than $5 million came from the Medical Services Corporation (MSC) in Spokane. Premera was formed after the 1998 partnership of MSC and Blue Cross of Washington and Alaska.

And the corporate leadership for that Arizona company? It's the same Washington and Alaska executive team that heads Premera. The only new executive listed in Arizona is Cliff Klima, president and CEO of LifeWise of Arizona.

Premera's ads suggest its proposed charitable foundations can help address Washington's and Alaska's unmet health-care needs, such as nurse training.

Do we have a nursing shortage? Yes. Do we have a shortage of other health professionals? Yes. Do we need more services for low-income folks? Sure we do. Is the conversion the way to solve these problems? No. Will the conversion give us a healthier future? No.

Of the 14 Blue Cross Blue Shield plans that have converted to for-profit status, 10 have been devoured by Wellpoint and/or Anthem — major national for-profit insurers.

Would they care a whit about Washington state or Alaska, if they purchased a new for-profit Premera? Ask any of their stockholders, who care more about return on investment, or their service representatives the next time you are on hold.

So if you are a grocer in Yakima, or an orchardist in Chelan, will a for-profit Premera care about your community?

If Premera is dropping Medicaid, Basic Health Plan and state employees — and playing hardball with Multicare and Providence Health Care — what makes anyone think it cares about the marketplace, the businesses or the people in Washington and Alaska?

Sure, we have a nursing shortage, but there are other ways to solve it than depending on money from Premera's proposed foundations.

The director of nursing at the Veterans Administration in Seattle had a great idea some years ago. She went to low-income human-services programs, and found some women who wanted to make a difference. She covered their education to become licensed practical nurses, then hired them at the VA. After a few years, she helped them go back to school with scholarships to study to be registered nurses.

Then there's a colleague in Florida who wants to start a vocational village where unemployed people could live and work together, help each other with cooking and day care, and get grants to go to school for a nursing degree or other allied health profession.

There are ways to solve the shortage problem or ways to cover the low income. This conversion is not the solution.

Kathleen O'Connor is founder of a nonprofit health-care-advocacy organization, CodeBlueNow! www.codebluenow.org