January 27, 2009-Bismarck Tribune

The insurance department, at least in part, denied the Blues’ request to raise its premium rates for individual and groups rates by 14.8 percent and 14.9 percent, respectively, last year because of the contract language that has now changed, Insurance Commissioner Adam Hamm said.

Hamm said the department will now go forward with studying the Blues’ rate increase requests and will issue its decision in the coming weeks.

“They took themselves to the edge of the cliff with that decision in May 2008,” Hamm said of the Blues’ contract language that let them reduce payments to health care providers. “To their credit, they’ve now stepped back from the edge of the cliff and removed that contract language that allows them to change payments whenever they want.”

The Blues appealed the insurance department’s denial in November, resulting in an administrative hearing. An administrative judge is expected to make a recommendation in the coming weeks, which could come before or after the insurance department makes a decision to approve or disapprove the Blues’ rate increase requests, Hamm said.

Denise Kolpack, spokeswoman for the Blues, said the company’s financial reserves were about $236 million in 2007, and dropped to about $200 million by the end of 2008.

Hamm said the department has monitored the Blues’ financial health throughout the negotiations, and that the company, the largest insurer in North Dakota, is in good shape.