A day and a half after the Source reported Blue Cross Blue Shield was pulling out of the territory Aug.1 while currently owning health care providers massive amounts of money, Lt. Gov. Osbert Potter, who by his position as lieutenant governor is also insurance commissioner, issued a statement saying he wasn’t going to approve the withdrawal until the company found another health insurance company to replace it.
Potter also said the “public announcement” about the mega insurer, managed out of Puerto Rico by publicly held Triple S, leaving the territory was “premature.”
“The commissioner is not obligated to approve the withdrawal of Blue Cross Blue Shield until receipt of proof that the liability of Blue Cross Blue Shield to its policyholders and obligees is fully assumed by another authorized insurer and that the policyholders in this territory are protected,” Potter’s statement read.
Blue Cross Blue Shield is one of only two health insurance providers in the territory willing to write insurance for businesses employing fewer than 51 people. Without absolute numbers it would be reasonable to guess that by far most businesses in the U.S. Virgin Islands employ less than 51 people.
BCBS is not planning to leave current policy holders without insurance on Aug. 1. Carlos D. Torres, senior vice president of BCBS USVI, said the company will see policy holders through the expiration of their current policies and settlement of all pending claims.
Steven Baker, insurance agent and principal of Baker Magras Associates, Inc., said Thursday he was disappointed with the short notice provided by BCBS. Baker pointed out that when CIGNA, the health insurance carrier for the V.I. Government, went from writing polices for small business to only those with 51 employees or more, they gave more than six months notice and renewed existing polices that fell within that grace period.
But by statute, the law allows the insurer to cancel any policy that allows for cancellation with a 15-day notice. Torres statement is unclear as to whether the company will renew policies that come due between now and Aug. 1, but he was clear there will be no new or existing business written after Aug. 1.
“Specifically, BCBS USVI intends to abstain from selling new group health insurance products or renewing existing group health insurance business in the Virgin Islands effective August 1, 2016,” he wrote in a letter dated May 3, according to the statement from the Lieutenant Governor’s office.
During its May 5 Earnings Call, Roberto Garcia-Rodriguez, president and CEO of Triple-S, said, “As part of our strategic decision to focus on the core and reevaluate unprofitable businesses, we have decided to discontinue offering group health insurance products in the U.S. Virgin Islands effective August 1, 2016.” He said Triple-S, the holding company that manages Blue Cross-Blue Shield in the USVI, is working with the territory. “to ensure a smooth transition out of this market segment.”
Triple-S will continue serving policyholders of the Blue Cross Blue Shield Association’s Federal Employees Program who reside in the Virgin Islands, along with some Puerto Rico-based employers that have branch office employees in the territory.
That doesn’t help the thousands of small to micro businesses that typify the Virgin Islands. Further, Blue Cross Blue Shield was the only insurer to show any interest in providing individual policies to the 30,000 uninsured people in the USVI. Unfortunately, that never happened and won’t now.
Though it is unclear what Potter’s assertion means that BCBS could fail to be given permission to pull out of the territory until it finds a replacement insurer, there may be some help on the horizon.
A man who has been closely involved in the health insurance business in the Virgin Islands since 1991 is trying to put together a plan for his company to step in and fill the Blue Cross gap.
Omar Haedo, a long time general agent for BCBS, sent a letter to the company’s agents in the territory this week saying it was the intention of his company, ELAN Insurance Agency, to “establish a replacement insurance company which will offer innovative products of interest to you and the market, excellent customer services and comprehensive network access to health services in the Virgin Islands, Puerto Rico and the United States.”
Haedo is clearly under the gun to make something happen in a place that is not known for fast tracking much of anything.
Meanwhile, small businesses in the territory will have to hold their collective breaths awaiting news of a fix for this newest blow.