Michael H. Samuelson is a big hitter in the health and wellness world, a well-known expert who’s helped develop a range of health promotion programs across the United States and abroad, led a major organization, and appeared on hundreds of radio and TV shows.
Since Blue Cross & Blue Shield of Rhode Island recruited him two years ago as vice president of health and wellness services, he’s certainly raised the company’s profile in that arena.
Locally, Blue Cross now has more than 300 “Good Health Benefit” accounts – in which employers pay extra to get smoking cessation, weight control, diabetes management and other programs – involving 100,000 people, according to spokeswoman Kim Keough.
But right now, Blue Cross can only sell those services to its existing subscribers – more than half the Rhode Island population, yes, but no one covered by UnitedHealthcare, or clients outside the state who want to benefit from Samuelson and his team’s expertise.
Seeing a major business opportunity, since last year, Blue Cross has been working to create a for-profit Health & Wellness Institute to serve those markets. Keough said Blue Cross wants to spend $140,000 to launch the institute, with Samuelson at the helm.
The plan hasn’t gotten very far, however, and Attorney General Patrick C. Lynch takes credit for that. In a recent news release, he explained that he’s concerned about Blue Cross putting part of its surplus – or subscribers’ premiums – into a for-profit enterprise, and he’s concerned about the privacy of medical information Blue Cross gathers from participants.
“This is potentially a risky venture, and the Rhode Island subscribers whose premiums will pay for it need to understand that,” Lynch said. “It’s risky because creating such a subsidiary may very well exceed the authority of Blue Cross’ enabling statutes. It’s risky because the reserves that Blue Cross will use to fund the subsidiary won’t be available to pay claims and administrative expenses in the event of a health care crisis, which is why the reserves exist in the first place. It’s risky because, as a for-profit consulting entity, no state regulatory body would be able to oversee it. And it’s risky because it creates the potential for Blue Cross to act as Big Brother in determining whether or not their subscribers can get access to needed health care.”
Blue Cross, however, says Lynch’s concerns are unfounded. Keough said neither reserves nor premiums would be used to finance the venture, though she couldn’t say where the money would come from; initially she said it would be a bank loan, but then said Blue Cross was no longer considering that option.
As for participants’ privacy, Keough said information is gathered “strictly” to help tailor services to each client’s needs – for example, to find out if there are many smokers at that workplace, or people with diabetes or heart disease. No individual information is ever disclosed, Keough said, and Blue Cross would always adhere to federal privacy rules under the Health Insurance Portability and Accountability Act.
The company’s assurances haven’t convinced Lynch and his staff, who’ve met several times with Blue Cross officials since urging them, last August, to “proceed with caution” with this new venture. Lynch said Blue Cross has been “very forthcoming” about its plans, but “it has not listened” to his warnings, so he’s tried to get the R.I. Department of Business Regulation, which oversees insurance companies, to step in.
In June, Lynch shifted his attention to newly arrived Health Insurance Commissioner Christopher F. Koller, but he didn’t get an answer to his letter. So last month, Lynch filed a formal petition for a declaratory ruling from DBR or Koller.
As of Wednesday, Koller had yet to issue his ruling, but he told PBN he soon would.
“We’ll look at their business plan and evaluate whether it’s consistent with their mission and their charter, to what extent it puts their insurance reserves at risk,” Koller said. The law may not be clear on all the relevant questions, he said, so “there will be a need for significant judgment and interpretation.”
