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SANTA FE — State Public Regulation Commissioner Jason Marks is criticizing a rate increase agreement signed by Blue Cross and Blue Shield and the state Insurance Division less than an hour before a hearing called to give critics a chance to talk about the plan.
“Instead of a public process, we got a back-room deal,” Marks said at Monday’s hearing.
The PRC ordered the meeting after protests over an average 24.6 percent increase in Blue Cross and Blue Shield premiums the division granted in December. Some premiums would have risen as much as 29 percent.
But 45 minutes before the meeting, the company and the Insurance Division, which falls under the PRC, signed a settlement decreasing the average rate hike to 21.3 percent. The settlement was signed by Blue Cross, division staff, the state attorney general’s office and insurance customer Jody Neal-Post, who had requested a public hearing.
The increase, retroactive to
April 1, affects about 40,000 people.
Blue Cross attorney Paul Bardacke described the settlement as a mediation.
“Everybody at the end was probably holding their nose about something, but that’s a sign of a good settlement,” he said.
Speakers told Insurance Superintendent Morris Chavez no decision should have been reached before the hearing.
“I came here thinking I was going to make a difference,” said Christopher Fletcher, a Santa Fe family practice physician.
State Sen. Dede Feldman, D-Albuquerque, said even the reduced rate hike is “excessive.”
Chavez said he was pleased by the settlement, which he learned about during a conference 45 minutes before the hearing.
“What I’m disappointed in is that the public tends to think that something wrong occurred here today and that their voices were not heard when, in fact, their voices were heard,” he said.
Chavez denied there was a back-room deal and said Marks’ comments were inappropriate.
He told about 60 people who attended the hearing the settlement would save consumers millions of dollars.
Blue Cross said it lost $20 million on the type of policies in question during the past three years and lost $11.1 million on all operations in 2009 — data Bardacke said supported a 36.9 percent increase.
Under the original deal, Blue Cross would have raised premiums on its most popular product by 29.5 percent. Some policies would have not increased.
The settlement requires a 3.3 percent reduction for products under the original filing. The company also will not seek another increase that would go into effect for the products before Jan. 1.