March 11, 2009-Bismark Tribune Editorial

These actions will go a long way toward giving stressed policyholders, more than 50 percent of North Dakotans, faith in the Blues.

The rising cost of health care, including health insurance premiums, has North Dakotans in low and middle incomes struggling financially, sometimes making the choice to go with less or without insurance that they really need.

Meanwhile, Blues sent members of its sales staff on a week-long Caribbean retreat. The cost: $250,000-plus. This for a health insurance provider that lost $28 million last year, and whose CEO received a $285,909 bonus in 2008. Further, the insurer wants a 13.8 percent increase in premiums.

North Dakotans expect this kind of excess from Wall Street, but not from the state’s majority health care provider, based in Fargo. It’s embarrassing, and people are angry about it.

There appeared to be a disconnect between the work ethic of policyholders and the Blues’ desire for perks.

True, the retreat for top sales people was booked in 2007 before the national financial meltdown, employees on the trip were taxed on its value and the Blues said they will not be making trips to the Caribbean in the future.

But moves like the Caribbean trip make policyholders wonder about the Blues’ judgment, and efforts to keep costs in line and to offer polices with the best possible premium price. It becomes a matter of trust or, rather, lack of trust.

North Dakota Insurance Commissioner Adam Hamm has started a “targeted financial examination” of the Blues, in particular, executive pay and bonuses. That seems prudent, although Hamm and the Blues have been feuding since his appointment to the commissioner’s job.

North Dakota needs its Blue Cross Blue Shield to be smart about costs and premiums. The policyholders need to have confidence that the insurer has their best interests at heart. A change of leadership goes toward that goal.

Although insurance premiums for BCBSND are stiff, they compare favorably with other states, including Montana and Minnesota. North Dakota average premiums are seventh from the lowest in the nation.