I am writing today to announce the closure of the New Mexico Independent. After three and a half years of operation in New Mexico, the board of the American Independent News Network, has decided to shift publication of its news…
While environmental activists played their part yesterday during demonstrations at the capitol building, going so far as to dress up as solar panels and to sing the tune of “You Are My Sunshine,” their counterparts, the anti-cap-and-trade contingency who has…
Roughly one quarter of University of New Mexico students are unimpressed with the state’s flagship public school, according to a survey that questioned college students about their higher education experiences.
Raton flower shops are the latest victims of a Nigerian phone scam, the New Mexico Attorney General’s office announced Tuesday.
Instead of using e-mail to contact their victims, the culprits are using Text Telephone (TTY) lines, a phone system for the hearing-impaired. They placed large orders and request to “over-pay” the shops so money can be wired via Western Union money transfers to the shipper, according to AG spokesman Phil Sisneros. More …
Like New Mexico, Maine crafted a state budget expecting that Congress would pass a six-month extension of extra funding for Medicaid, the government’s low-income health insurance program. Without the extension Maine would be looking at a $85 million budget hole. Now Maine’s top budget official hopes President Obama’s letter urging Congress to extend extra Medicaid funding another six months will carry some weight in the nation’s capital, according to the Kennebec Journal.
But New Mexico is in a worse position than Maine. If Congress doesn’t extend the federal Medicaid stimulus dollars, New Mexico will have a $160 million budget hole for the year that starts July 1. More …
The state Insurance Division will this week vacate its controversial April approval of a Blue Cross Blue Shield of New Mexico health insurance rate hike settlement, Public Regulation Commission (PRC) chairman David King told The Independent Monday morning.
The move expected this week does not represent a formal rejection of the request or a final decision; it will simply restart the process.
Commissioner Jason Marks had condemned the settlement as “a back room deal.” Angry commissioners voted May 13 to order the Division to reverse its approval of the settlement, which was negotiated over a weekend without public hearings.
But former acting superintendent Tom Rushton, who had helped negotiate the 21.3 percent rate hike, resigned the following day without issuing an order to vacate the agreement.
Rushton was replaced May 20 by Craig Dunbar, who could not vacate the agreement because a technicality prevented him from staying in the job; State law requires the insurance superintendent to have lived in New Mexico for three years, but Dunbar returned to New Mexico from Texas only last year.
Blue Cross Blue Shield attorneys had threatened to sue the PRC if the Division withdrew its approval for the rate hike. But concerned that Dunbar’s appointment might be challenged in court if he vacated the rate hike, because of the residency issue, commissioners decided to replace him, they told The Independent.
Dunbar was replaced last week by Johnny Montoya
Incoming interim superintendent Johnny Montoya will vacate the Division’s approval this week, Dunbar and King said.
If that happens, the division will also clear a separate request to reverse the approval submitted by the original complainant in the case, Blue Cross Blue Shield NM policyholder and Albuquerque Attorney Jody Neal-Post. Jones defected from the settlement agreement May 27.
Describing Blue Cross Blue Shield as “a corporation with apparently endless litigation resources,” Neal-Post noted in a filing submitted to the Division Monday that the company had hired yet another attorney to fight her request that the settlement approval be vacated.
The PRC’s selection committee will begin reviewing candidates Tuesday for the permanent superintendent, King said. A “permanent” superintendent should be appointed by late summer, King said.
King questioned the constitutionality of residency requirements, noting that “many” candidates for the permanent superintendent position could not apply because they had not lived in New Mexico during the past three years.
Actor Val Kilmer will use rental proceeds from his Pecos River guest ranch to raise money for the Santa Fe Film Festival, he announced Monday.
That might buy Kilmer some good will in Santa Fe, but it is unclear whether or not it will help him at next Wednesday’s San Miguel County commission meeting, where he will have to allay commissioners’ concerns about his “racist” comments to entertainment magazines before they will approve his permit application to run a guest ranch. More …
President Obama joined the chorus of governors and state officials across the country Saturday as he urged Congress to extend the boosted rate of federal government spending on Medicaid, the government’s low-income health insurance program. More …
The state is thinking about giving tens of thousands of New Mexicans living at or below the poverty line a choice: pay $75 monthly premiums currently paid by the state or risk losing their health care coverage.
State officials conceded this week if the cost-saving measure were adopted it could push some of the more than 45,000 low-income adults making $903 or less a month off New Mexico’s health care rolls.
“They would lose coverage,” Human Services Department (HSD) spokeswoman Betina Gonzales McCracken said of individuals who might find paying monthly premiums financially out of reach.
The proposal, one of dozens under consideration, would apply to a program once viewed as a way to lower the state’s high uninsured rate, which is second only to Texas –the State Coverage Insurance (SCI) initiative, which New Mexico started several years ago.
The idea already is running into opposition from state lawmakers who say demanding $75 a month from individuals who might not be able to afford it would limit access to health care.
“I know we have a tough budget,” said Rep. Danice Picraux, D-Albuquerque, and chairwoman of the Legislative Health and Human Services Committee. The panel is charged with studying health care issues between legislative sessions.
“I can’t tell them where they should be cutting or re-directing money, but it’s not my first choice,” Picraux said.
Ideas to cut costs
The idea of making low-income residents pay their own premiums is part of the New Mexico Human Services Department’s ongoing attempt to address ongoing budget pressures.
It also is a reminder of how harrowing the state’s path over the next three years is as it struggles to provide health care for its poorest residents before 2014, when the federal government swoops in to assume most of the costs under the new federal health care law.
While the individuals targeted by the proposal live at or just below the federal poverty level, they currently make too much to qualify for Medicaid, the government’s low-income health insurance program. Under the new health care law, they would automatically qualify for Medicaid in 2014, when the new law expands eligibility to individuals who earn 133 percent of the federal poverty level.
State Medicaid director Carolyn Ingram told the Independent on Tuesday that the idea of doing away with premium assistance for this population is only a suggestion, and that no final decisions have been made.
But she acknowledged that the state is considering that idea and others, including charging low-income residents nominal co-pays for emergency room services, because the state’s Medicaid program is under severe budget pressures. Medicaid is a primary funding source for the SCI program.
New Mexico’s budget crunch
A confluence of factors is creating the financial pressure.
First, state officials project that the number of New Mexicans, adults and children, using Medicaid and Children’s Health Insurance Program (CHIP) will grow by 8 percent between this past December and June of next year, from 479,000 to 518,000 individuals. CHIP provides health care for low-income children from families that make too much to qualify for Medicaid.
Currently New Mexico pays roughly 20 percent of Medicaid costs, thanks to federal stimulus dollars. The federal government picks up the other 80 percent. But paying one fifth of the costs is a struggle because of lagging revenues, state officials say.
Add to that the fact that federal stimulus dollars now helping New Mexico pay for Medicaid run out in December, unless Congress extends the deadline. If Congress doesn’t extend the federal Medicaid stimulus dollars, New Mexico will have a $160 million budget hole for the year that starts July 1. That’s because the state budget the Legislature passed in March assumed congressional approval of an extension and budgeted $160 million in the anticipated dollars to help cover costs.
It’s unclear whether Congress will pass that extension.
So, in essence, New Mexico faces a double whammy: find money to replace the lost federal dollars while trying to figure out how to address the growing enrollment in Medicaid and CHIP.
Financial strain on SCI
All those budget pressures are placing a strain on the State Coverage Insurance program, which is funded both by federal and state dollars, Ingram said.
The program was always envisioned as a way to extend health care coverage to New Mexicans who either didn’t have it because their employers didn’t provide it or because they made too much money to qualify for government programs.
Because it’s not an entitlement program, the federal government caps how much New Mexico can spend in federal dollars on the program. At the same time the state is running short of money.
“Unfortunately with the state budget, we are running out of both pots of money,” Ingram said.
Currently the state picks up the $75 monthly premiums for more than 45,000 adults across the state, making them eligible for New Mexico’s State Coverage Insurance program.
But the budget pressures are making the state’s assistance increasingly difficult, she said.
Swastika branded into arm of young Navajo against his will. Photo from a KRQE Channel 13 newscast.
In April, three Farmington men used a heated coat hanger to brand a swastika into the arm of a mentally challenged Navajo man. The community was shocked, but the branding was part of a recent spate of violence against Navajos that began in 2006, just a few years after the New Mexico Advisory Committee to the U.S. Commission on Civil Rights returned to the city to assess how things have changed since another violent incident 30 years ago.
Farmington has struggled with racial violence
In the mid-1970s, an economic boycott and weekly protests by Navajos brought attention to the city after three young Anglos were sent to reform school rather than jail after torturing and killing three Navajo men.
In 1975, the Commission on Civil Rights produced The Farmington Report: A Conflict of Cultures, which described a city ill-equipped to handle a “crisis in race in relations” and detailed the discrimination faced by Navajos. In its 2005 follow-up, The Farmington Report: Civil Rights for Native Americans 30 Years Later, the commission noted continued discrimination in the city but also said significant progress had been made.
But then, in 2006, two brutal incidents in Farmington led the Navajo Nation to create an official human rights commission. First, a young Navajo, Clint John was killed, shot four times by a police officer in Farmington. The police officer was cleared of wrongdoing in the case, but many thought the officer had used excessive force. A few days later, three white youths beat and robbed a middle-aged Navajo man. They were convicted under New Mexico’s 2003 hate crimes law after admitting they intentionally targeted a Navajo.
Now, there is the branding of the 22 year old man—who has the mental capacity of a 12-year old—with a swastika; the three perpetrators also shaved a swastika into his hair and wrote racial epithets on his body. The victim said he felt treated like an animal. Authorities haven’t released all of the evidence found at the crime scene, but they told The Navajo Times that they found memorabilia and items associated with white supremacists.
Authorities have indicated they will charge the three perpetrators under New Mexico’s hate crimes statute, which allows for stronger sentencing when a jury finds that a criminal act was motivated by bias. In this case, while two of the perpetrators are white, defense attorneys have pointed out that the third is American Indian—part Navajo and part Sioux. One of the white perpetrators told authorities that the victim wanted to be branded with the swastika because it’s a tribal symbol, which the victim disputes.
Duane “Chili” Yazzie, Chairman of the Navajo Nation Human Rights Commission, believes the act is a hate crime regardless of the ethnicity of one of the perpetrators.
“Whether or not he’s a young native person is beside the point,” Yazzie said in an interview with The Independent. “He participated and therefore he’s a perpetrator of a hate crime.”
Yazzie swiftly dismissed the idea that the victim would want to be branded with a swastika.
“The idea that it isn’t a Nazi symbol, but more of a Navajo symbol, is an excuse to minimize that it’s a Nazi symbol,” Yazzie continued. “It doesn’t explain away what they did. They had no thought that it was a Navajo symbol when they branded the young man.”
Ongoing violence against Navajos has multiple sources
Farmington is one of a series of “border towns” that bridge the intersection of the Navajo Nation with non-native communities. Located in San Juan County, in northwestern New Mexico, the town is home to about 43,000 people, roughly 70 percent of them white, according to Census figures. Almost 17 percent are American Indian, higher than the statewide average of 10 percent.
The town is an economic hub that is heavily reliant on both the oil and gas industry and members of the surrounding Navajo community who come into town to shop and do business. An expansion of the oil and gas industry over a period of recent decades has led to an influx of people, Yazzie said.
“These relative newcomers seem to be one source of insensitivity that’s been targeting our people,” he said.
According to Yazzie, mass protests and a boycott by Navajos after the 1970s incident led community leaders to take notice and improve the environment for Navajos in Farmington.
“Our action back then had a strong impact,” he said. “The education of the community was substantial and it led to the people refraining from that kind of activity for many years. We’d hear of people being cheated over counters and disrespected, but not this violent type of activity until 2006.”
But according to Navajo educator Dr. Larry Emerson, who lives near Shiprock, a Navajo town not far from Farmington, the violence Farmington has deeper roots.
“Certain Farmington white youth seem to carry on a violent tradition of venting their unresolved rage, loss, and anger on disadvantaged Diné,” Emerson wrote in an e-mail to The Independent.
Both Yazzie and Emerson made a point of acknowledging that many of white society in Farmington strives for change in the racial pattern of the area that has led to violence against Navajos.
“There are white folks in Farmington who appreciate and value cultural and racial diversity and tolerance, too,” Emerson said. “They bother to understand Diné history, culture, identity and politics. Many whites work for such values, but I don’t know if they are in the majority. I suspect not.”
Yazzie said the solution is ongoing education, which is why the commission is actively working to develop partnerships with surrounding border towns and major cities in New Mexico and Arizona, with the goal of expanding coordination and cooperation in educating young people and newcomers.
But in addition to public programs, Yazzie said, in order to rid society of hate crimes families have to do internal education as well.
“I think the city of Farmington and the business community is doing all it can to prevent this kind of incident—there’s a focus on education for the public,” he said. “They need to continue doing what they are doing. But also, every person who has an understanding of these issues should set an example, both in public and when with their families.”
The Attorney General’s office cannot say whether or not it received all of the financial records it demanded from Blue Cross Blue Shield of New Mexico before signing off on a controversial April 26 rate hike settlement, according to spokesman Phillip Sisneros.
The company did not disclose financial records to the PRC Insurance Division supporting figures in its rate hike application, The Independent reported. More …
Arizona politicians have described the border country as a “war zone,” justifying their state’s controversial new law requiring residents to carry papers proving citizenship or immigration status.
But the border country is “one of the safest parts of America, and it’s getting safer,” the AP reported Thursday, describing an internal Customs and Border Protection study obtained with the Freedom of Information Act. In fact, violent attacks against Border Patrol agents declined in 2009. More …
The identity of an elderly New Yorker, June Smith, was used for fraudulent Medicare claims in New Mexico, Florida, California and Arizona, the New York Daily News reported Tuesday.
Several of the exams and tests for which the government was billed defied common sense. Smith, a 72-year-old woman, supposedly received up to $50,000 worth of exams, including a pregnancy test, semen analysis and prostate cancer tests. More …
Blue Cross Blue Shield of New Mexico did not provide the state Insurance Division with documentation for financial losses and expense figures cited as justification for last month’s controversial health insurance rate hike, Public Regulatory Commission (PRC) records show.
The company’s defense for failing to back up their figures with supporting evidence? Regulators did not ask for any.
Insurance Division staff have not required Blue Cross Blue Shield NM, or other health insurers, to submit documentation supporting rate increase requests, Blue Cross Blue Shield officials said, leading PRC Commissioner Jason Marks to describe the Division’s regulatory culture as “insufficiently skeptical.”
Rate hike application ‘not properly documented’
When the Attorney General’s office hired award-winning insurance rate analyst and former New Jersey insurance regulator Allan I. Schwartz as an independent expert to review Blue Cross Blue Shield’s rate hike filing, he reported that supporting documentation for most of the figures cited by the company was missing. And what little data was available, Schwartz concluded, contradicted the company’s claims.
The company’s requested rate hike was not justified, he concluded.
“The BCBSNM rate filing was not properly documented and supported,” Schwartz said in testimony to the Insurance Division March 2. “The filing did not provide sufficient documentation regarding numerous aspects of the BCBSNM rate calculation … Hence, the filing does not provide reasonable actuarial support for the proposed rate changes.”
Approving the rate hike would “continue a pattern of large rate increases for New Mexico health insurance consumers,” Schwartz cautioned, making it “increasingly difficult” for New Mexicans to afford individual health insurance.
The company presented numerous complex economic expense and loss indicators — variables such as “duration adjustments,” “deterioration adjustments,” and “annual deductible leverage.”
These figures were used to calculate an “Indicated Rate Change.”
Data presented contradicted BCBS claims
But the figures may have been smoke and mirrors, Schwartz suggested.
“The problem with the BCBSNM filing is that none of these various components … were documented or supported,” he said.
Where data was available, it contradicted Blue Cross Blue Shield’s claims, Schwartz found.
The “annual base trend” is an estimate of past financial losses. It is used to adjust projected future revenues from individual insurance policy premiums.
Schwartz calculated the company’s actual yearly loss trends on individual-market insurance policies over the past seven years and found they had varied between 4 and 8 percent — well below the 10 percent a year claimed by Blue Cross Blue Shield.
“Based upon this analysis, the loss values used in the BCBSNM rate filing are inflated and result in an excessive rate indication,” Schwartz said.
The Insurance Division and Attorney General’s office staff nevertheless negotiated a weekend rate settlement deal to raise Blue Cross Blue Shield rates by 21.3 percent for approximately 40,000 New Mexicans, without a public hearing that had been ordered by PRC commissioners. Former state insurance superintendent Morris “Mo” Chavez resigned in the face of outrage over the deal expressed by policyholders and PRC commissioners. Interim superintendent Tom Rushton, who helped negotiate the deal, subsequently resigned after PRC commissioners voted to direct him to vacate Chavez’s approval of the rate hike.
Parent company had surplus of $6.7 billion
Last month’s rate hike was just the latest of many, The Independent found. The Insurance Division had approved Blue Cross Blue Shield rate hikes every year since 2004, PRC documents show.
Blue Cross Blue Shield NM officials and former state insurance superintendent Morris “Mo” Chavez repeatedly raised the specter of the insurer’s solvency and financial losses. But asked about the financial condition of the insurer’s parent company, Health Care Service Corporation, Schwartz painted a very different picture, testifying the firm “has a strong financial position.”
“At year-end 2009, Health Care Services Corporation had a surplus of about $6.7 billion,” Schwartz testified, citing the corporation’s annual report.
In each year since 2004, the Insurance Division approved Blue Cross Blue Shield NM rate hikes. But for each year since 2005, Schwartz found, Health Care Service Corporation had a net income of at least $500 million, for a total net income of $4.4 billion.
Health Care Services Corporation’s net income last year exceeded $740 million, according to a May 25 online company profile.
Health Care Services Corporation’s annual report also showed “a much lower level of expenses” than Blue Cross Blue Shield NM claimed to the Insurance Division, Schwartz noted.
Blue Cross Blue Shield told state regulators that 26 percent of insurance premium revenues go to corporate expenses, but the parent company’s annual statement shows an 11 percent expense ratio, Schwartz said.
“While there may be an explanation for the dramatic difference in the expense ratios shown for Health Care Services Corporation as a whole and the values BCBSNM included in its filing, BCBSNM has not provided such an explanation,” Schwartz said.
Nor did the company include in their projected future losses, the savings resulting from disease prevention and wellness programs, Schwartz noted — even though those programs had explicitly been adopted to reduce policyholders’ medical claims costs.
Regulators did not request supporting documentation
Blue Cross Blue Shield did not provide supporting documentation for its claims because they were never asked to do so, according to company officials.
The Blue Cross Blue Shield rate increase filings included “everything required by the New Mexico Insurance Division,” Director of Actuarial and Underwriting Department Kevin Carr testified April 9, citing a Division checklist for rate increase filings. “We are not required by the NMID (Insurance Division) to include all of this documentation in our rate filing.”
“Based on my discussions and correspondence with the (Insurance Division) staff, they felt that our assumptions, including trend, were reasonable,” Carr testified.
Rate increase filings in New Mexico “generally do not include all of the underlying data”, Carr said. “In fact, based on my review of rate filings of other insurers in New Mexico, we generally provide much more information in our filings than most of the other insurers.”
Insurance Division staffers take insurers’ figures at face value, Carr’s testimony suggested.
For example, the 10 percent “annual base trend” figure Schwartz found to be inflated had been accepted by Insurance Division staffers even without the underlying data, Carr claimed.
“The 10 percent assumption for the annual base trend was specifically reviewed by and discussed with (Insurance Division) staff as part of the rate increase process, and they agreed that it was a reasonable assumption,” Carr said.
Insurance Division staff did not question the other figures, Carr said.
“The (regulatory) culture is insufficiently skeptical,” PRC Commissioner Jason Marks said. “On health care, the assumption is costs are just a national disaster and nothing can be done about it … that it’s unavoidable. But rates are rising faster than needed. There needs to be more skepticism, and related to that I’d like to see a different orientation. The regulator has a responsibility to make sure every penny passed on (to consumers) is required by law.”
Marks had described last month’s weekend rate hike settlement as “a back room deal,” a reference to the Insurance Division’s failure to hold public hearings.
The Division has a responsibility to confirm insurers have prudently incurred the expenses cited in rate change filings, Marks said.
“Just because there’s a cost in your accounting system doesn’t mean you accrued it responsibly and can pass it on to consumers,” Marks said.
State Auditor Hector Balderas has ordered his Special Investigations Division to begin an on-site risk assessment at the Bernalillo School District by the end of next week.
The move follows a risk examination, or review, of Bernalillo School District audit findings since 2006, according to a May 19 letter Balderas wrote to Superintendent Barbara Vigil-Lowder. Audit findings describe accounting problems and violations of the law found during state-mandated annual audits. More …
Attorneys for Blue Cross and Blue Shield of New Mexico have threatened to sue the Public Regulation Commission (PRC) if the Insurance Division vacates its controversial approval last month of a 21.3 percent health insurance rate increase. More …
New Mexico Public Regulation Commission (PRC) commissioners Thursday morning unanimously directed Interim Insurance Superintendent Thomas Rushton to rescind the Insurance Division’s controversial approval of a 21.3 percent hike in the health insurance rates for individual policyholders of Blue Cross Blue Shield N.M.
Rushton announced that he had recused himself from further involvement in the case.
That, at least, came as welcome news to the Attorney General’s office, according to Spokesman Phillip Sisneros.
“We do support Mr. Rushton’s recusal from a hearing on the matter,” Sisneros said. “(But) our position is still in support of the settlement. Remember, our agency is not the policy making authority on this issue and in fact, we were asked to step in to help find a resolution. We are happy to continue in that advisory role in the future.”
Rushton appeared reluctant to rescind the Insurance Division’s April approval of the rate hike, telling commissioners that rate change review procedures had been followed.
“There was a hearing conducted,” Rushton said. “There was prefiled testimony. There was discovery. There was a settlement reached, and Morris Chavez accepted that stipulated settlement.”
PRC Chairman David King interrupted Rushton to say that there were outside interests that had not been heard in the rate hike settlement process.
“We’ve had death threats to the Commission, to staff, and the former superintendent (Chavez),” King said. “They certainly followed the law, but it wasn’t done as well as in California,” where a Blue Cross rate hike was recently overturned.
Rushton assigned Deputy Insurance Superintendent Darlene Gomez to be the hearing officer for the reconsideration of the settlement approval. Gomez will receive whatever staffing assistance she needs from the Commission, King pledged.
But the Insurance Division will work under close Commission scrutiny, King said. King said the Commission will also ask for a third-party independent audit of Blue Cross Blue Shield NM’s financial records.
Commissioners King, Jason Marks, and Jerome Block, Jr. have all said they want the PRC to investigate why Blue Cross Blue Shield has a virtual monopoly in much of rural New Mexico.
Marks and Block appeared to try to manage policyholders’ expectations, Thursday.
“I don’t want false hope here,” Marks said. “It’s only right to do what we can. But we don’t want false hope. There’s still a stipulated settlement.”
Block said Blue Cross Blue Shield was starting “from scratch,” as far as he was concerned.
But he cautioned that the company would not take the Commission’s decision lightly, and warned policyholders that the extra scrutiny could backfire on consumers.
“They’re going to come out swinging,” Block said. “There could be (financial) data that justifies a higher increase. I hope the public is ready to face that outcome if it’s substantially different.”
Switching interim superintendents?
Marks also floated the possibility of replacing Rushton as interim superintendent with former insurance superintendent Don Letherer, noting that Rushton is very busy.
“Don could keep the wheels on,” Marks said. “We’d have twice the assurance the job’s getting done.”
Commissioners agreed to add a meeting with Letherer to next week’s Commission agenda.
Insurance Superintendent Morris Chavez
State Insurance Superintendent Morris Chavez resigned Tuesday morning, following intense criticism for his approval last month of a 21.3 percent rate increase for Blue Cross Blue Shield New Mexico individual policyholders without any public hearings.
But last month’s contentious rate hike was nothing new.
The state Public Regulation Commission (PRC)’s Insurance Division has approved rate increases for Blue Cross Blue Shield individual health insurance policies every year since 2004, according to state Insurance Division documents obtained by The Independent.
The Independent sought comment from Chavez Tuesday morning, only to learn staff was scrambling to announce his resignation.
In several cases, the rate hikes were comparable to this year’s increase, exceeding 20 percent.
Cumulatively, the increases approved each year since 2004 have pushed up premiums for Blue Cross Blue Shield NM policyholders by as much as 154 percent, Insurance Division records show.
In 2009 alone, rate increases for the company’s Blue Choice and Blue Choice Plus policies increased 19.6 percent and 24 percent, respectively. The company’s NM Major Medical policies saw a 2009 rate increase of 24.7 percent and Number One policy rates increased 22 percent in 2009.
The financial impact of rate increases on policyholders can be profound, policyholders told The Independent.
Moya Melody and her husband Kim Radsliff, Santa Fe residents, now spend 30 percent of their income on their Blue Cross Blue Shield NM policy, Melody said.
Last month’s rate increase brought their montly premiums up to $1,305 a month, Melody said. When they first bought their Blue Cross Blue Shield NM policy in 2004, they paid $562, or 16 percent of their household income, Melody said.
Two PRC commissioners want more transparency
Health insurance rate increases have not been contested before in New Mexico, PRC Commissioner Jason Marks told The Independent.
“The only insurance rate increase appealed … in the past decade was an appeal two years ago over title insurance,” Marks said.
PRC Commissioners knew about the 20 percent Blue Cross rate increase in 2009, but had not been aware that the Insurance Division had routinely approved rate increases since 2004, Marks said.
“We knew about the 20 percent (Blue Cross) rate increase last year, but this 150 percent increase (since 2004) is news to me,” Marks said.
In the future, health insurance rate increases exceeding 10 percent should trigger public hearings and full Commission review, Marks said.
Commissioner Jerome Block Jr. agreed.
“It’s unfortunate the Insurance Division has treated rate increases as a routine or typical process,” Block told The Independent. “These aren’t typical times. New Mexicans are struggling. I’d like to see the 10 percent threshold serve as a red flag for public hearings and Commission review.”
The Commission also needs to investigate why Blue Cross Blue Shield NM is the only individual health insurance provider in much of rural New Mexico, Marks said.
Blue Cross Blue Shield NM spokeswoman Becky Kenny did not respond to repeated requests for comment on the rate increases. Nor did Kenny respond to requests for information regarding executive salaries.
Kenny refused to disclose the Blue Cross Blue Shield NM’s tax filings, and would not say whether or not the not-for-profit would provide tax filings to policyholders. Blue Cross Blue Shield NM is a division of Health Care Service Corporation (HCSC), a mutual insurance company that is owned by its customers. Profits must be reinvested in the business or given to customers.
HCSC’s chief executive officer was paid $10.6 million in salary and bonuses in 2008, according to documents filed with the Insurance Division by Consumers Union attorney Sondra Roberto.
State Insurance Superintendent Morris J. “Mo” Chavez resigned Tuesday morning.
“After careful deliberation with my family, I have decided to tender my resignation as Superintendent of Insurance effective close of business today, May 4, 2010,” Chavez said in a two-sentence resignation letter addressed to PRC Commission Chairman David King. “It has been an honor to serve the citizens of New Mexico.”
Chavez had come under fire for approving, without public hearings, a Blue Cross Blue Shield NM individual health insurance rate hike of 24.6 percent. The increase was subsequently reduced to 21.3 percent.
Since Chavez took office in October 2006, he approved several health insurance rate increases, all without public hearings.
More …
The end of the U.S.-Mexico border fence in California (Photo by Bisayan lady/Flickr)
Arizona Governor Jan Brewer cited “border violence and crime due to illegal immigration” as motivations for signing a controversial law requiring people in Arizona to carry proof that they are in the U.S. legally.
But FBI and U.S. Department of Justice data show that Arizona’s violent crime rate is lower than the U.S. average and has been declining more rapidly than the U.S. average, The Independent found.
Despite a growing population, violent crime rates dropped sharply in Arizona between 2002 and 2008, the latest year for which complete federal crime data are available online.
According to the U.S. Department of Justice’s Bureau of Justice Statistics, Arizona’s population-adjusted violent crime rate dropped from 555 reported incidents per 100,000 people in 2002 to 447 per 100,000 in 2008.
That 19.5 percent decline was much more pronounced than the U.S. average during the same time period, The Independent found.
Nationwide, the violent crime rate dropped by 7.9 percent, from 494 violent crimes per 100,000 population in 2002 to 455 in 2008, The Independent found.
New Mexico saw a 12 percent decline in violent crimes between 2002 and 2008, according to the Bureau of Justice Statistics database.
But at nearly 650 violent crimes per 100,000 people in 2008, New Mexico’s crime rate was considerably higher than both Arizona’s and the U.S. average.
Reports by the nonpartisan Immigration Policy Center and libertarian CATO Institute both indicate crime rates fell in Arizona over the past decade.
Census data show that overall, immigrants are less likely to commit crimes than U.S.-born people, according to both institutes.
ICE officials did not return The Independent’s calls Monday, requesting illegal immigration statistics for New Mexico, Arizona and Texas.
The state Health Department and Department of Finance and Administration (DFA) have agreed to jointly administer the Health Policy Commission (HPC), according to a memorandum of understanding released by the Health Department. More …
Federal, state and tribal officials met Wednesday morning to launch a three-month long White House-sponsored television ad campaign aimed at methamphetamine abuse among Native Americans. The campaign will last through July and cost the federal government approximately $750,000.
“It’s not a hugely expensive campaign,” U.S. Drug Czar Gil Kerlikowske acknowledged. But the ads are tailored to Native American audiences, emphasizing cultural pride and strength, he said.
State and tribal officials urged that more federal resources be devoted to confronting Indian Country’s meth epidemic, while others said the government is ignoring the underlying problems driving the crisis.
“A decade ago, it seemed that meth use was very rare in Indian Country,” U.S. Bureau of Indian Affairs (BIA) Assistant Secretary Larry Echo Hawk told an audience of 50 Wednesday at the Indian Pueblo Cultural Center in Albuquerque. “That’s certainly not the case anymore. It’s reaching what can be described as epidemic proportions now.”
Methamphetamine abuse rates among American Indians and Alaska Natives are the highest for any ethnicity in the nation, nearly twice that of any other ethnic group in the U.S. based on emergency room data and the National Survey on Drug Use and Health, White House Drug Control Policy Director (U.S. “Drug Czar”) Gil Kerlikowske said.
The Navajo Nation, where 15 percent of high school students reported meth use in 2003, is particularly hard-hit, New Mexico Secretary of Indian Affairs Alvin Warren noted.
“The FBI estimates that 40 percent of violent crimes on the Navajo reservation are meth-related,” Warren said. “To succeed, this campaign must be a part of a comprehensive, collaborative effort with the federal government. It has to include sufficient resources for treatment, prevention and law enforcement.”
The true scope of the meth problem in Indian Country is unclear, Kerlikowske acknowledged — partly because of the number of urban Indians involved.
“It’s very difficult to get your head around just how many people (are involved),” Kerlikowske said. “A lot of Native people don’t live on tribal lands.”
Part of the problem for those who do live on Indian reservations, is the allure of vast, under-policed and remote spaces to meth manufacturers and traffickers, officials said.
Reservation land “is very remote,” Isleta Pueblo Governor Robert Benevides, a retired BIA police officer, told The Independent. “Drug traffickers know that.”
As Mexico has clamped down on the importation of meth precursor chemicals and the U.S. has tightened control of the U.S./Mexico border, myriad small-scale “shake and bake” meth labs are popping up in Indian Country, Drug Czar assistant director Mark Krawczyk said.
“Mexico as a key source of meth has sort of evaporated,” Krawczyk said. “Now we get small-scale shake and bake labs using pseudoephedrine bought over the counter. The effects are magnified because there are all these tiny meth labs on the sides of roads.”
Over the past two years, federal agencies have assigned 30 new drug enforcement officers to help police the land of more than 500 U.S. tribes, Echo Hawk said.
“Six or seven” more will be added nationwide this year, he told The Independent.
But that’s not enough to confront the problem, others said.
“We need more law enforcement in the field,” Benevides said. “The money is not adequate.”
Isleta is surrounded by centers of meth abuse, and federal support for law enforcement on the Pueblo is inadequate, Benevides told The Independent. The tribe has enough money from its casino to fund two police officers, he said.
There needs to be increased collaboration between tribal, state and federal law enforcement, emphasized Joe Garcia, Southwest Area Vice President for the National Congress of American Indians.
Underlying problems unaddressed?
Some tribal members, while supportive of the ad campaign, told The Independent the underlying problems driving meth and heroin drug abuse on Indian reservations are not being addressed by government anti-drug efforts.
“Mental health, that is where it comes from — depression,” said Adrienne Mauskemo, a member of the Meskwaki Nation in Iowa.
Mauskemo emphasized that she was speaking as a mother, not a representative of her tribe.
“Maybe children are neglected and they are trying to find some ways to get away from their pain,” Mauskemo said. “They have suicidal ideas. When they’re trying to treat the drug problem, first they need to deal with the mental health.”
The television ads emphasized key words, Mauskemo noticed: support, nurturing, strength.
”But what does it mean to be strong,” she asked. “Do the youth know? To me, it’s inner strength, to speak to yourself. I will not do this. I was able to speak to myself that way. It kept me out of trouble. That is how I see things.”
In an effort to provide safe recreation venues for children and teens, the Isleta Pueblo has built soccer, baseball and T-ball fields, a recreation center and swimming pool, Benevides said.
”If you don’t give our kids a place to go, they will get into trouble,” Benevides said.
Acoma Tribal Councilman Derek Valdo also cited underfunding of the U.S. Indian Health Service’s mental health programs as part of the problem.
“It’s bad enough just trying to get medical services for basic needs,” Valdo told The Independent. “They’re emphasizing law enforcement and prevention, but what’s lacking is the other part: how do we fix it afterward?”
Tribes face a major challenge with cleaning up houses that have been used as meth labs, Valdo said.
There exist no national standards for what residual level of meth lab chemicals is safe, as there are for radiation exposure or radon, Valdo pointed out.
Expansion to include public health
The ad campaign represents a shift for the federal government, toward a public health model of confronting the meth problem, officials suggested.
Acknowledging widespread mistrust for the federal government in Indian Country, Kerlikowske emphasized the state and local government backgrounds of the federal officials at the meeting, and said that talking of a “war on drugs” was not “the best way to talk about what is a public health problem.”
“We’re not going to arrest ourselves out of something like this,” Echo Hawk said. “We’ve got to challenge our young people to make good decisions.”
Older adults abusing meth too
The ads, which emphasize the themes “pride” and “we don’t need meth,” were produced by Alternative Marketing Solutions, a Native American-owned advertising agency, according to a press release distributed at the meeting.
The ads were test marketed in Pine Ridge, South Dakota, New Mexico, Arizona and Washington, Kerlikowske said.
“In the past, ads have been generic. I don’t think an anti-drug ad made in Brooklyn will resonate (in Indian Country),” Kerlikowske said. “These ads are directed both at young people but also adults, elders, parents—about how to…provide help.”
But many Native Americans struggling with meth addiction are themselves middle-aged and older adults, others said.
“It’s not just youth,” Garcia said, whose hair is graying. “A lot of people as old as I am, and older, are using meth.”
“We are seeing it in the older group, the 40 to 50 age group,” Mauskemo told The Independent after the meeting. “I’m speaking as a mother, not for the tribe. I see huffing (of solvents or gasoline) in 10 and 11 year-olds. That’s how you see the pattern start.”
The three-month campaign has a $1.5 million “media value,” Kerlikowske said, though only about $750,000 of government money was actually invested in the ads and paid advertising slots, Krawczyk later told The Independent.
“These are paid ads,” Krawczyk said. “After the campaign ends, we’re making them available as public service announcements to tribal and local governments.”
Roughly 40,000 New Mexicans will watch their health care premiums rise by an average of 21 percent after the state struck a weekend deal with Blue Cross Blue Shield New Mexico.
The agreement may be a done deal after Monday, but how it came about had one member of the state Public Regulation Commission howling mad and at least one state lawmaker calling for legislation to overhaul the state’s rate-setting process.
“This should have been deliberated in public,” PRC member Jason Marks said of the rate hike.
PRC commissioners ordered state Insurance Superintendent Morris Chavez last month to hold Monday’s public hearing on Blue Cross Blue Shield’s request to raise rates 24.6 percent, something that insurance Division staff had approved originally in February.
“Instead, we got a backroom deal,” Marks said. “It could be an appropriate, reasonable deal, but I do know I had a lot of questions that haven’t been answered.”
The settlement was negotiated over the weekend by the Insurance Division, state Attorney General’s office and Blue Cross Blue Shield New Mexico, a Division of Health Care Service Corporation.
The rate hike will affect approximately 40,000 policyholders, and will be retroactive, taking effect April 1. The rate increase will affect several individual market health plans offered by the company. Employer-based health plans will not be affected.
News of the agreement surprised and, in certain cases, infuriated some of the more than 50 people that had packed the Public Regulation Commission hearing room in Santa Fe for what had been billed as a public hearing about the company’s request to raise its health insurance premiums. At least eight armed state police officers were on hand Monday, highlighting the tension.
The surprise agreement also led to predictions that the Legislature would tackle how the State Insurance Office sets rates in next year’s 60-day legislative session.
“I think the result of this will be legislation to change rate setting,” Sen. Dede Feldman, D-Albuquerque, told The Independent on Monday afternoon. “I don’t think anyone was happy with this ruling. And I’m hoping for the cooperation of the insurance commissioner and the AG.”
Several attendees of Monday’s meeting, meanwhile, said they were disappointed to learn that the agreement had been forged prior to Monday’s scheduled hearing, especially after some had taken time off from work.
“I came here thinking we’re going to make a difference,” Dr. Christopher Fletcher, a Santa Fe Blue Cross provider, said. “Instead, this was done behind our backs. I don’t care if it was the front room, the back room, or the bathroom.”
How the agreement was struck
State Insurance Commissioner Morris Chavez appeared to take umbrage at the implication that the state or his staff had done something improper in forging the agreement.
“You’ve made some very serious allegations about a backroom deal,” Chavez said to Marks in a moment particularly fraught with tension. “I don’t think it was a backroom deal. To make a statement that the Attorney General of New Mexico made a backroom deal is mind-blowing.”
Chavez told the PRC that the agreement came out of a fear that Blue Cross Blue Shield might pull out of providing health insurance in rural areas around New Mexico. Blue Cross Blue Shield insures up to 70 percent of rural New Mexicans who buy their own insurance, according to Chavez.
“Of concern was they’d potentially be pulling out of the (rural New Mexico) market,” Chavez told the PRC.
The deal struck over the weekend has Blue Cross Blue Shield NM agreeing to continue to sell insurance in rural New Mexico and to do a better job of informing consumers about changes in their coverage, and to provide 60 days’ advanced notice for future rate hikes, Chavez said.
Chavez also pledged to post proposed rate hikes on the Insurance Division website in the future.
Insurance Superintendent’s responsibilities a concern
Chavez said Monday in explaining this weekend’s agreement that he is required by state law to consider the “solvency” or economic well-being of regulated corporations, and Blue Cross Blue Shield NM reports that it is losing money.
That didn’t sit well with Feldman, the Albuquerque state senator.
“They say they were forced to rule on very narrow grounds,” Feldman said. “We need to make sure the public is protected as well as the insurance companies.”
Also of concern to Marks was the insurer’s “medical loss ratio” — or how much of revenue is spent on medical care — of 66 percent.
“I wonder (about) the loss ratio in the 60 to 66 percent range,” Marks said. “We as a state just passed a law saying the minimum loss ratio should be at least 75 percent. We could ask why 33 percent on overhead and administrative compensation is reasonable, and why they’re sitting on more than $6 billion in reserves. …I would have liked to have heard these questions addressed in a public process.”
Marks was referring to a new law that limits how much an insurance company can spend on administrative costs.
Blue Cross Blue Shield NM owner HCSC is a mutual insurance company, owned by its customers; profits must be reinvested in the business or given to customers. But HCSC’s chief executive officer was paid $10.6 million in salary and bonuses in 2008, according to Consumers Union attorney Sondra Roberto, who had urged Chavez to reverse the rate increase.
“They have a lot of money,” Fletcher, the doctor and Blue Cross Blue Shield provider, told The Independent of Blue Cross Blue Shield NM. “They just lie straight out. Payments for us doctors, Blue Cross is one of the worst.”
The rate hike will hit some hard
The details of Blue Cross Blue Shield’s business structure was lost on Moya Melody, who was concerned with more immediate matters. Melody, who attended Monday’s hearing, said the new rates will represent 30 percent of her household’s income.
“Last year, we had a 20 percent increase and we just couldn’t pay,” Melody said. “So we went from a $500 deductible to a $1,000 deductible. Now, it’s still going up again this year.”
Moya and her husband, carpenter Kim Radsliff, have seen rate increases from Blue Cross Blue Shield NM every year since 2004, when they paid $562 per month, she said. That represented about 16 percent of their household income.
Now, with the increase approved today, they will pay $1,305 per month — 30 percent of their household income, Melody said.
“As far as I’m concerned, they’re a profit-making business,” Melody said. “We’re self-employed and don’t have a choice except to have no insurance at all.”
NMI’s Trip Jennings contributed to this story.
