Michigan’s governor unveiled legislation Tuesday to make the nonprofit heath insurer Blue Cross Blue Shield subject to $100-million in state and local taxes, the Detroit Free Press reports.
The bill would make the state’s Blue Cross unit a “mutual insurance company,” maintaining its nonprofit status but eliminating its tax exemption. The measure also calls for the insurer to pay $1.5-billion over 18 years into a separate nonprofit entity that would tackle major health issues such as obesity and infant mortality.
Blue Cross would gain a streamlined and speedier system for reviewing its rate requests, a process that now takes up to 18 months, state officials said. The insurer said in a statement that it is open to considering the plan, which would have to be approved by its board as well as by state lawmakers.
The measure would remove special status accorded to Blue Cross by state law in 1980 as the “insurer of last resort.” Mr. Snyder said the designation is outdated, particularly with the advent of the federal health law that requires private insurers to accept clients regardless of pre-existing conditions.