Minot Daily News Editorial on BCBS (September 10, 2009)

Keeping an eye on the Blues

After Blue Cross Blue Shield of North Dakota fired its chief executive earlier this year, officials at the non-profit insurance giant that insures more than 375,000 North Dakota residents vowed to make changes.

Now, an audit ordered by Insurance Commissioner Adam Hamm has found “a lack of judgment” by board members and senior management members.

”The culture of this organization is very different than it was a few months ago,” board chairman Dennis Elbert said in an Associated Press story following the release of the report.

We certainly hope so.

Among other things, the report said the company used premium payments to pay for $15 million in employee bonuses, spent nearly $35,000 on a party for a retiring vice president and spent $3.5 million as an investment in a Fargo hotel.

Paul von Ebers, who took over as president and chief executive when Mike Unhjem was fired in March, said the company has already begun making changes by cutting back on incentive trips for employees, reducing expenses for executives and cutting out-of-state travel. The company will also compare executive compensation levels with similar jobs in North Dakota instead of nationwide.

It all sounds good, and North Dakotans have every right to expect Blue Cross Blue Shield to follow through with these changes. The company has a responsibility to spend premiums from clients on the proper items namely providing quality, affordable health insurance to its thousands of customers.

North Dakotans will no doubt be watching, especially if the company again seeks a large rate increase. We suspect Hamm will be watching, as well.