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.
The Public Regulation Commission (PRC) voted 4-to-1 Tuesday afternoon to appoint John G. Franchini as the state’s newest superintendent of insurance. Commissioner Jason Marks cast the dissenting vote.
Franchini has worked in the insurance industry for more than 35 years, since he joined his father’s insurance brokerage as a salesman, according to a letter to commissioners that accompanied his resume. He worked as vice president for government affairs at New Mexico Mutual, the state’s workers’ compensation underwriter, from 2002 until January 2010, according to his resume.
Franchini was appointed one day before the state Supreme Court is scheduled to hear a Blue Cross Blue Shield NM petition to reverse acting superintendent Johnny Montoya‘s order suspending the rate hike. 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 …
Interim state Insurance Superintendent Thomas Rushton will retire effective June 22, Public Regulation Commission (PRC) Chairman David King confirmed Monday evening.
Rushton was appointed Interim Insurance Superintendent May 4, immediately upon the resignation of former superintendent Morris…
Interim state Insurance Superintendent Tom Rushton may rescind his predecessor’s April 26 approval of a Blue Cross Blue Shield New Mexico health insurance rate hike — the result of a weekend settlement Rushton helped negotiate to the outrage of policyholders and Public Regulation Commission (PRC) commissioners. Commissioners want Rushton to stand aside while the rate increase is re-examined, and Commission chairman David King is calling for a third-party audit of the insurer’s books.
Does Blue Cross Blue Shield New Mexico’s rate increase presage a coming stampede from health insurers seeking increased rates prior to the first reforms of the new federal health care laws taking effect? A quick survey of several officials in recent days found differing opinions on the question. But a few pointed to several provisions in the new law that could lead health insurers to request rate increases.
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.
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