February 24, 2010-Bismarck Tribune
Hamm revokes insurance agent’s license
BISMARCK, N.D. (AP) — Insurance Commissioner Adam Hamm has revoked the license of a Stutsman County insurance agent.
Hamm says Kyle Cuypers failed to disclose criminal convictions on his insurance producer license application last February.
Hamm says Cuypers consented to losing his license and waived his right to a hearing. Cuypers did not immediately return a telephone call Wednesday seeking comment.
Hamm says Cuypers reported to the department in November that he had been convicted of driving under the influence the month before, and the department subsequently learned that Cuypers had been convicted in previous years of making false reports to law enforcement and fleeing police.
February 11, 2010-Grand Forks Herald
Hamm advises flood insurance coverage
North Dakota Insurance Commissioner Adam Hamm said there is a 30-day waiting period for a flood insurance policy to take effect and not all flood damage will be coverered by federal assistance.
By: Herald Staff Report, Grand Forks Herald
BISMARCK - North Dakota Insurance Commissioner Adam Hamm encourages homeowners, renters and business owners to think about purchasing a flood insurance policy.
“The latest information available from the National Weather Service indicates that there is a good chance North Dakota will see some spring flooding,” Hamm said. “Since there is a 30-day waiting period before a flood insurance policy becomes effective, it is imperative that people do not procrastinate but start checking into the purchase of a policy soon.”
Flood coverage must be purchased separately as it is not covered under a homeowner’s policy. Flood insurance is offered and underwritten by the National Flood Insurance Program. Several insurance companies in North Dakota write and service flood policies through the NFIP. The list of companies in North Dakota that write and service flood policies through the NFIP is available at www.fema.gov/nfipInsurance/companies.jsp.
Hamm said that in the past, some consumers assumed they would receive disaster relief from the federal government to recover from flood damage.
“Not all floods are declared disasters, so consumers should not count on federal assistance,” he said.
For information regarding flood insurance coverage, call (800) 638-6620 or www.floodsmart.gov
February 4, 2010-Fargo Forum
Sanford approved to sell insurance in ND
The entry of the Sanford Health Plan will be the first major new health insurance offering in North Dakota since Medica arrived 20 years ago.By: Patrick Springer, INFORUM
The entry of the Sanford Health Plan will be the first major new health insurance offering in North Dakota since Medica arrived 20 years ago.
Insurance Commissioner Adam Hamm announced Wednesday that he has given Sanford, which is affiliated with Fargo MeritCare, approval to sell health insurance plans in North Dakota.
“I think this is very good news for the people of North Dakota,” Hamm said. “Competition and choice helps ensure that there are high-quality products for North Dakotans and that they can get them at an affordable price.”
Sanford still must seek approval to sell policies at approved rates, Hamm noted, a review he expects will be done in one or two months.
Ryan Bohe, chief administrative officer for Sanford Health Plan, said a “handful” of employees will be based in Fargo to handle customer service and provider relations.
One way Sanford strives to distinguish itself in the market is by focusing on wellness and preventive health for its customers, Bohe said.
In South Dakota, Sanford has between 20 percent and 25 percent of the overall group health insurance market, behind Wellmark, the Blue Cross Blue Shield plan.
Blue Cross Blue Shield of North Dakota, despite the recent loss of MeritCare and Grand Forks Altru customers, remains by far the dominant private health insurer in the state.
As measured by premiums sold, the Blues commanded almost 90 percent of the private health insurance market last year, according to the most recent figures available from Hamm’s office.
Last year, Blue Cross Blue Shield’s enrollment in North Dakota was 480,780, and had dropped to 455,463 as of January, a decline of more than 5 percent, due to the loss of MeritCare, and Altru, which switched to Medica.
Still, the entry of the Sanford Health Plan, which ranks as the second provider of health insurance in South Dakota, where it started in 1998, marks a milestone in the North Dakota. Hamm said.
Last year, Medica began offering individual coverage in North Dakota. Before then, it focused solely on employer groups in the state.
Because Sanford’s health plans are not yet approved for sale, a Blue Cross Blue Shield of North Dakota spokeswoman said she could not offer specific comments about products and pricing.
“However, as we have always done, we will continue to look at ways to offer the most competitive price for comparative products,” said Denise Kolpack, the Blues’ vice president for communications.
Sanford, which covers 13 counties in southwest Minnesota, also is seeking to expand its coverage to include the western half of Minnesota.
February 4, 2010-Minot Daily News
Insurance department programs recover $7.6 million for North Dakotans
By JILL SCHRAMM, Staff Writer jschramm@minotdailynews.com
North Dakotans saved or recovered nearly $7.6 million in 2009 with the assistance of the North Dakota Insurance Department, according to a report released Tuesday.
The largest amount was an estimated $4.5 million saved by people assisted through the State Health Insurance Counseling Program. The program helps people with Medicare enrollment, particularly the prescription drug benefit.
The department recorded 18,529 contacts through SHIC, a 16 percent increase over 2008. Numbers have been growing every year since the introduction of a Medicare Part D in 2005, when the number of people using the program jumped from 651 to 3,198.
“What’s driving it is Part D, but also the knowledge of the program has continued to grow. Word of mouth has spread around the state as to what SHIC offers,” Insurance Commissioner Adam Hamm said.
More people are recognizing that help is available related to Medicare throughout the year and not just during the annual enrollment period for drug benefits, he said.
“Some of the SHIC volunteers, too, have really taken the initiative to promote or advertise that they are available to help people,” said Merry Green, a SHIC counselor with the Minot Commission on Aging. Insurance Department staff are aided in providing services by 90 volunteer counselors across the state.
The Commission on Aging and AARP set aside three days a week when people could schedule appointments with their counselors during the Medicare Part D enrollment period, Green said. Other local agencies that offer SHIC also have increased their outreach, including setting set up enrollment clinics in area communities, she said.
Hamm said it has been a challenge to obtain SHIC volunteers in some areas to keep up with the growing number of contacts. The Minot region has been doing well with its volunteer numbers, but the Insurance Department encourages more people and agencies to get involved. The state provides SHIC training for new volunteers.
Green said Minot’s medical and social agencies that work with seniors are willing to participate as volunteers with their employees because they understand the impact of health costs on their clients. The cost of prescription drugs ranked as a top concern of the region’s seniors in a survey conducted by the Commission on Aging, she said.
SHIC counselors have helped seniors with drug costs by ensuring that they are enrolled in the most appropriate Medicare prescription drug plans and are receiving reduced-cost medicines when they are eligible.
The $4.5 million savings from SHIC listed by the Insurance Department is an estimate based on national averages provided by the Center for Medicare and Medicaid Services.
The department reports the $7.6 million saved for North Dakotans also represents money saved through Prescription Connection and recovered through its hotline, through complaints filed by consumers against insurance companies and agents and through investigations performed by the department.
In 2009, the Insurance Department hotline handled nearly 8,500 phone calls, helped 157 walk-in clients and processed 264 formal complaints against companies or agents. The complaint numbers have dropped considerably over the past 10 years, although fines of $42,850 in 2009 were up over 2008.
Hamm said the department works to resolve any differences between insurance companies and their clients, and increased claims payments that clients receive as a result of those interventions are included in the $7.6 million.
January 31, 2010-Fargo Forum
Blue Cross Blue Shield reworking incentive program
Will ‘toughen up’ what it takes to meet goals
The pay plan for executives at Blue Cross Blue Shield of North Dakota is being revamped to include incentive targets including health cost containment and quality of care.By: Patrick Springer, INFORUM
The pay plan for executives at Blue Cross Blue Shield of North Dakota is being revamped to include incentive targets including health cost containment and quality of care.
The new executive incentive plan, still a work in progress, is a response to an examination by state insurance regulators that concluded a “pay at risk” reward system virtually assured success.
A consultant advising Blue Cross Blue Shield of North Dakota also concluded its incentive was not challenging enough, said Paul von Ebers, the Blues’ chief executive officer.
“We accept that recommendation and want to toughen up what it takes to meet our goals,” he said.
Adam Hamm, North Dakota’s insurance commissioner, said he has not yet been able to evaluate the proposal, or get a detailed presentation from Blue Cross Blue Shield.
“We want to drill down on all the materials,” Hamm said. “I’m looking forward to meeting with them face to face,” an exchange he hopes will take place in the next few weeks.
Hamm directed the company to draft new polices to ensure that salaries and benefits are based on the North Dakota market and to implement “meaningful measures” to improve performance, including incentive pay.
One major shift in emphasis in performance goals is to reward executives for achieving targets that include health cost containment and quality.
Traditionally, the Blues’ executive incentives were heavily weighted on the company’s financial performance. Revenues, largely based on premiums, were rewarded – an indicator that ignored rising costs to consumers.
A major customer, the North Dakota Public Employees Retirement System, or NDPERS, pushed for management incentives that benefit consumers – with cost control topping the list.
“We felt the incentives should be member-based and not just based on company performance,” said Sparb Collins, executive director of NDPERS. “Our concern is the overall cost.”
Blue Cross Blue Shield representatives recently met with the NDPERS board, but Collins said he has not seen the proposed new executive pay incentive plan and is reserving judgment.
“I want to see the details,” he said.
Health care inflation in North Dakota has averaged about 8 percent a year over the past decade, von Ebers said. He would like to see a gradual reduction – 6½ percent, for instance, in three or four years, and ultimately about 5 percent.
“Our sense is we’re going to have to chip away at this,” von Ebers said, noting that health costs in North Dakota are below the national average. “It’s also going to take working with our members to get there.”
The examination found questionable administrative costs, including a sales reward trip to Grand Cayman Island, other travel costs and severance pay. Those problems have been addressed, von Ebers said, by new policies.
The company is also striving to boost productivity, with plans to leave many staff vacancies unfilled when they occur from normal turnover.
This year, Blue Cross Blue Shield will freeze administrative costs constant, at $16.23 per member per month, von Ebers said, although staff received a 2½ percent wage increase.
Personnel costs, in salaries and benefits, comprise 52 percent of the Blues’ administrative costs, which totaled $96.7 million last year and are budgeted at $93.2 million this year.
“We have to find productivity,” von Ebers said. The company has the equivalent of 916 full-time employees, down from 918 last year.
“That will continue to decline this year as part of our commitment to increase efficiency,” said Denise Kolpack, the Blues’ vice president for communications.
The pay plan still strives to provide total compensation – base pay and incentives – that falls in the midrange of similar companies.
Initial results of a pay survey found that the Blues’ executive compensation was in line with large North Dakota employers. That suggests “broad-scale” changes aren’t called for this year, consultants concluded.
Except for financial stability goals, which are easy to measure, no major changes are planned for the executive pay plan this year because standards continue to be defined, but will begin full implementation next year.
Other health insurers, including Wellmark Blue Cross Blue Shield, which covers South Dakota and Iowa, have adopted measures aimed at restraining costs and improving quality.
“We’re not alone in this,” von Ebers said. “But we do think it’s a constructive change.”
The tougher goals mean that executives would meet their target goals 50 to 60 percent of the time, and their “stretch” goals 10 to 15 percent of the time, Kolpack said.
Failure to meet all of their goals would decrease the incentive portion of executives’ compensation, called “pay at risk,” but still would enable their pay to reach the midrange over a 10-year period, according to Watson Wyatt, the consulting firm.
Blue Cross Blue Shield of North Dakota’s 13-member board of directors, each paid $30,000 a year, is scheduled to discuss board compensation at its February board meeting, Kolpack said.