News Releases

Health Care: Murray Admonishes Regence CEO for “Irresponsible” Decision to Stop Offering Health Coverage Option for Washington Children

Sep 30 2010

Murray points to decision to circumvent new protections as an example of why health insurance reform is “absolutely necessary”, says she will explore “legislative remedy” if profit-driven decision to deny Washington children is not reevaluated

(Washington, D.C.) – Today, U.S. Senator Patty Murray sent a sharply worded letter to Mark Ganz, the President and CEO of Regence BlueShield calling on him to rescind a recent decision to stop offering child-only health insurance policies. In her letter, Murray made clear that the decision is an example of why Washington families are dissatisfied with health insurance companies and why health insurance reform, which gives customers strong new protections from insurance company practices, is so vital.

“For too long the rules of the road have put insurance companies in a position where they can pick winners and losers by putting profits before patients,” Senator Murray wrote. “The Affordable Care Act finally puts patients on an even playing field. Your decision to cut health insurance for kids and pad the bottom line is an attempt to go back to a broken system. I ask that you rescind this misguided policy and work with me to ensure that pre-existing condition exclusions for children never again prevent Washington state children from getting the care they need. Otherwise, I will be forced to look at any legislative remedy to ensure that everyone – especially children – have access to affordable health care coverage.”

The text of Senator Murray’s full letter follows:

September 30, 2010

Mr. Mark B. Ganz
President and Chief Executive Officer
Regence BlueShield of Washington
P.O. Box 1271 Mailstop E15A
Portland, Oregon 97207-1271

Dear Mr. Ganz, 

I am writing to strongly encourage you to rescind your September 28th decision to stop selling new child-only individual health insurance policies beginning October 1st. If there was ever a decision to point to on why Americans distrust health insurance companies and their practices, this is it.  And if there was ever a reason to point to on why it was absolutely necessary for us to pass strong new patient protections in the Affordable Care Act, this is it as well. Your decision is clearly a veiled attempt to circumvent the intent of Congress and the safeguards included for children.

Each year, tens of thousands of children who either were born with or developed a costly medical condition were denied coverage by insurers. The Affordable Care Act stops this egregious practice and prohibits children from being denied coverage because of a pre-existing condition, helping them and their parents gain access to stable health insurance coverage and care.  Specifically, group health plans and new individual market policies may not deny coverage to a child because of a pre-existing condition in plan or policy years staring on or after September 23, 2010.

On June 22, the Departments of Treasury, Labor, and Health and Human Services (HHS) issued straightforward regulations implementing this law.  On July 27, in response to concerns expressed by the insurance industry, HHS released further guidance, clarifying that plans would not be violating the new rules if they allowed children to enroll in insurance only during a specified open enrollment period, to help limit instances of parents enrolling their child in a policy only when they became ill or needed treatment. To address your concerns Washington State Insurance Commissioner Mike Kreidler issued an emergency rule last week, allowing individual health plans to limit their risk by creating a special open-enrollment period from November 1 – December 15.

 Unfortunately, this was not enough and you seem want to go further - by making a profit-driven decision on the backs of children with pre-existing conditions. These children still have new coverage options and protections under the reform law that they didn't have before, but unfortunately you have decided to stop offering child-only policies because it does not help your bottom line.

 The prohibition on discrimination against children with pre-existing conditions has widespread support, including from the health insurance industry.  In a letter to Secretary Sebelius on March 29, the head of America’s Health Insurance Plans, the nation’s largest health insurance association, wrote, “Health plans recognize the significant hardship that a family faces when they are unable to obtain coverage for a child with a pre-existing condition.  That is why health plans in 2008 proposed reforms to make pre-existing condition exclusions a thing of the past.”

 For too long the rules of the road have put insurance companies in a position where they can pick winners and losers by putting profits before patients. The Affordable Care Act finally puts patients on an even playing field. Your decision to cut health insurance for kids and pad the bottom line is an attempt to go back to a broken system. I ask that you rescind this misguided policy and work with me to ensure that pre-existing condition exclusions for children never again prevent Washington state children from getting the care they need. Otherwise, I will be forced to look at any legislative remedy to ensure that everyone – especially children – have access to affordable health care coverage.

Sincerely,

U.S. Senator Patty Murray