State Sen. Jeremy Stine, R-Sulphur, has not changed his mind about the sale of Blue Cross Blue Shield of Louisiana, a nonprofit, to Elevance, a for-profit company.     

“I remain opposed, even more opposed now,” he said. “Not a lot has changed except for the makeup of the foundation board.”

Elevance says the deal will mean Louisiana policyholders would enjoy the benefit of new, expanded services and new technology. As a national company with millions of customers, Elevance argues it can negotiate for less expensive prescription drugs than Blue Cross.

The Louisiana Medical Society has urged caution to the 96,000 policyholders regarding the sale. The Hospital Association has not come out against the deal. The Medical Society represents more than 4,000 doctors, some of whom are members, Stine said.

One of those doctors, a retired attorney and an insurance agent — constituents in Stine’s district — called the senator’s attention to the pending sale back in July. Stine was on the Senate Insurance Committee at the time.

“My major concern, and this is what I’ve been saying all along, is that premiums will increase, jobs will be lost and service levels will go down. As a for-profit company, Elevance could place its shareholders and profits over patient health and create efficiencies over keeping jobs.

“Blue Cross has 3,500 employees across the state and Elevance has agreed that it will not cut employment for two years. But what will happen in two years? If they are already doing this in Indiana, why would they need Baton Rouge?”

Stine has been digging into Elevance since July and found out the company is being investigated by the Department of Justice. He said the for-profit has paid $1 billion in fines since 2000.

In the second quarter of 2023, Elevance posted $1.9 billion in profits, according to Healthcare Finance News.

In advertisements that have been running in newspapers across the state, BCBSLA says premiums will not be raised as a result of this transaction.

“You realize that those ads are being paid for with your premiums if you’re a policyholder,” Stine said. “Blue Cross has one revenue stream, your premiums. So every ad you see, every billboard, every newspaper ad, every mailed postcard is being paid for with Blue Cross Blue Shield policy premiums.”     

After the deal was announced last year, The Times-Picayune quoted Sen. Kirk Talbot, R-Metairie, in an article about the deal. Talbot said, “We’re going from a nonprofit to a for-profit company and rates are going up every year as it is. That scares the hell out of me.”

Accelerate or brake?

How the money will be divided between the foundation and policyholders, and how the board of directors will benefit from the sale has drawn criticism.

About $307 million from the sale will go to a little over 90,000 policyholders. That comes to about $3,000 each.

Policyholders will get a $3,000 check if the sale goes through. Not every Blue Cross of Louisiana-insured person would get this money. If the insurance is employer-provided for example, the employer/policy holder would get a $3,000 check.

Seven Blue Cross board members will continue to serve on an advisory board to Elevance leadership, where they will be paid $105,000 a year for the next 10 years. That comes to about $ 1 million each, Stine said. “That’s what they are paid now to serve on the board. They probably spend about four hours a month doing that, he said.

The lion’s share of the money will go to create Accelerate Louisiana. The creation of a conversion foundation must happen when a for-profit buys a nonprofit. More than $3 billion, over 90 percent of the deal’s proceeds, will establish this foundation.

However, it had to make changes in it to meet criticism in advance of upcoming Senate hearings. The board makeup was changed. Now it includes a Gov. Jeff Landry appointee and an Insurance Commissioner Tim Temple nonvoting observer. Secondly, it will be incorporated in Louisiana instead of Delaware.

The Louisiana Budget Project (LBP) has concerns about the foundation filing as a 501c4. LPB monitors and reports on public policy and how it affects Louisiana’s low-to-moderate income families.

LPB’s Jan Moller submitted a public comment to the Department of Insurance. It’s posted on the group’s website.

“By organizing under the relaxed rules that govern social welfare organizations, there would be little to stop Accelerate Louisiana from functioning as a powerful lobbying arm of the for-profit health industry, endorsing and promoting political candidates who favor the industry’s positions (which may not reflect the public interest).”

Moller wants Insurance Commissioner Temple to require the foundation to file as a 5013c public charity with written safeguards that guarantee it will serve a true public purpose and promote policies and programs that enhance public health.

A Metairie attorney has filed suit against the foundation that would be created if the sale is approved. He says the billions in foundation money belongs to policyholders who have paid thousands of dollars in premiums to Blue Cross over the years.

Elevance announced the acquisition in Jan. 2023. It was suspended in September.  Members of the Louisiana Senate’s Health & Welfare Committee and Insurance Committee will meet jointly Monday, February 5, 2024 at the State Capitol.

“Discussion will be centered on what this potential acquisition will mean for 1.9 million members across the state, half the population,” Stine said.