Looking for reform? Don’t look to BCBS-MI

A letter to the Detroit News challenges the opinion that Michigan’s model of relying on nonprofit insurance provider Blue Cross Blue Shield of Michigan is one for the country to replicate.

Under Blue Cross Blue Shield of Michigan’s control, competition and innovative cost-savings models are squashed. But Blue Cross and hospitals prosper while families, businesses and individuals suffer.

Blue Cross’ 2008 revenues were in excess of $21 billion. The nearest competing health care plan generated only $1.6 billion in revenue. Blue Cross has little competition in Michigan.

This is the case in many states that the President claims have insufficient competition – the top insurer’s status as a near-monopolist for health insurance in the state is largely thanks to government policies that make it easier for it to function at a lower cost than its competitors.

No wonder so many Americans are wary of a public option.

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