Governor Snyder’s Plan to Modernize Michigan’s Health Insurance Market

By Bonnie Bochniak
Vice President, Government Relations
MBPA/MFBA

November 2012 – The Michigan Business and Professional Association (MBPA,) along with the Michigan Food and Beverage Association (MFBA), want to keep you informed on all health care updates in our state.  We pride ourselves in communicating on a daily basis with legislators, legislative staff, department directors, and other key stakeholders.  One of our critical undertakings for the past few years has been the Federal Health Care Law, and getting to know this law inside and out, and getting to know how it will impact you.

Recently, there has been action set forth by Governor Snyder that would modernize Michigan’s health insurance market, keeping in check with the new federal health care law, which includes making Blue Cross Blue Shield of Michigan (BCBSM) a nonprofit mutual insurance company.  This proposal (Senate bills 1293, 1294), written into legislative form by Senator Joe Hune, was presented to the State Senate and just passed its chambers with approval in late October.  The Governor’s proposal now heads to the State House for further deliberation and possible action in its chambers before this year’s end.

This legislation takes the shape of the Governor’s proposal and will help to level the playing field, which would in turn encourage competition among insurers, promote efficiency and cost reduction, and offer affordable and accessible health care coverage.  Whether or not the health insurance exchange is run by Michigan or the Federal Government, each state must have a regulatory system that facilitates a competitive and efficient marketplace.

Highlights of this legislation (proposal) include:

-BCBSM would contribute approximately $1.5 billion over 18 years to form a nonprofit fund to improve the health of Michigan and improve access to health care (fund would be governed by stakeholders and experts).

-Blue Cross would have to pay state and local taxes (they currently do not).

-All health insurers would be regulated under the Michigan Insurance Code and be subjected to same rules and regulations (currently they are not).

-18 other states have already legislated Blues mutual restructuring.

-Governor Snyder will be conducting a review of this transition to ensure that the value of BCBSM’s contribution aligns with what should be contributed through its nonprofit mission.

The proposal will continue to undergo further examination by legislators and key stakeholders, with additional public hearings in the future for comment.  If you have any questions about this proposal and/or future hearing dates, please contact our legislative team by phone: (586) 393-8800 or by email at: BBochniak@michbusiness.org.

We will continue to keep you informed on this issue as it moves through the legislative process.