Will GHI/HIP Merger and Privatization Raise Costs?

Monday, March 3, 2008

Recently, we have been made aware of the dangers of the GHI/HIP merger, which is supported by the UFT and most other unions. Guess what? The unions get a windfall out of this – nothing to do with the members, of course, who will probably get screwed by higher costs. After all, this is all about privatization which will remove state controls – we've seen how corporate greed works out.

It should be pointed out that the UFT has been part and parcel of the move to privatize the public schools, whether in support of charters like Green Dot or their own charter schools, the backing of Gates and Annenberg money to control public ed policy, etc. Plus making sure to get their swag from the professional development money train – a regular little corporate model, our UFT.

We had a brief discussion on this at last Friday's ICE meeting and will be following up. The group fighting this will be giving out a leaflet at the Delegate Assembly this Weds. The have been going around to opposition caucus meetings of various unions to make their objections known. Recently hundreds of people attended a hearing on the issue. Many were locked out until they called NY 1 and "suddenly" space was found for them.

Right now New York City has been opposed, fighing for a bigger share of the cut. (My God! We're on the same side as Bloomberg!) But expect that to be settled soon.


Everyone should start asking questions about this. What are the unions getting? How will that affect the members? What are politicians getting? Check contributions from GHI/HIP to campaigns, etc.

Ed Notes had this report on Feb. 25, 2008:
There are UFT members and others who feel the merger of HIP and GHI is a bad thing. The result will be a joint privatized HIP/GHI operation instead of being under public control. Instinct says that is not a good thing. Check it out here. http://socialistparty-usa.org/stopthemerger/

Anthony Weiner called for Congressional hearings on the HIP/GHI merger back in Nov. '06, stating:

I write to request that you convene Judiciary Committee hearings early in the next Congress to examine whether consumers are being adequately protected from anti-trust concerns when health care insurers merge.

In New York, the two health care insurers that cover 90 percent of the City’s municipal employers, GHI and HIP, have announced their intention to merge. The Department of Justice and the State Insurance Department have both approved the union, failing to find any anti-trust concerns.

But the City of New York believes that the new merged health provider will create a monopoly, eliminating the City’s leverage when negotiating for employee health coverage, and empowering these two health insurers to demand taxpayers pay them tens of millions of dollars more than they currently receive.

As New York Mayor Michael Bloomberg said today, the proposed merger, “is taking away the City’s ability to negotiate a fair price for health care plans. . . .The City’s tax payers are going to be so royally taken advantage of. . .so [GHI and HIP] can rip us off.”

Yesterday, Judge Kenneth M. Karas of the Southern District of New York refused to intervene to block the merger.

This most recent proposal is part of a larger pattern of insurance mergers. Oxford was purchased by UnitedHealthcare in 2004. And last year, the parent of Empire Blue Cross and Blue Shield, the largest insurer in New York State, was purchased by Wellpoint for $6.5 billion.

This issue demands enhanced oversight. I look forward to focusing on anti-trust issues facing the health insurance industry early in the next Congress.

If anyone has info on the follow-up, share it.

Think the UFT would ever support Weiner for Mayor? I bet Bill Thompson, our Comptroller and the UFT fave for mayor, supports the merger. Don't know for sure, just a guess.

The Weiner letter is at:
http://www.house.gov/list/press/ny09_weiner/061117merger.html

The president of the Medical Society of the State of New York believes the conversion of the GHI-HIP insurance company would have a negative impact on patient care and payments to physicians. - Jan. 30, 2008. Read in full here.

The UFT take from Arthur Pepper is here. Pepper will supposedly be on the Board to protect your interests (supposedly.) He says: Most importantly, all through the process both GHI and HIP have pledged to their subscribers to keep to the mission of affordable and quality health care.

Sort of like the DOE "pledge" to reduce class size. But there's more about the incest between the UFT and HIP.

Ira Goldfine reported on ICE-mail yesterday:

Tonight's Jeopardy answer is:

Arthur H. Barnes senior vice president for External Affairs and Corporate Contributions at HIP Health Plans

and the question is "Who was Sandra Feldman's husband?"

The share of the pot that will be given to NY State upon the two companies merging is huge and the UFT has been part of this for years -- this was talked about before Randi ever made her entrance into the UFT. Supposedly the unions were going to get a piece of the action in return for their support.

Loretta Prisco followed up on ICE-mail with this report:

Recently I ran into an old friend at a concert. During intermission, she told me about the hearings that she went to about the ghi/hip merger and it is going for-profit. She was really incensed, and to be honest, I couldn't quite get to the facts. So I called her.

There were 70 listed speakers - there were reps from other unions - who all spoke against it. She is looking for the list of speakers for me.

The Emblem presentation did not talk about quality of care at all.

One union rep challenged them about jobs leaving NYC. Emblem assured them that there would be no loss of jobs to NYC. The rep said that 15 jobs had already moved out to LI.

No doctors spoke.

She is pretty disgusted over the fact that the UFT wasn't there and that we are not getting info - "we are professionals - smart - and should be getting some facts - pros and cons". She is as upset over how the union is dealing (or rather not dealing with us on this ) than the possible loss of services and increased fees.

She said that NYC was against it at the hearing - but now, as we know, for it. NYS is in favor of it because as a for profit - they can collect taxes. Again, nothing about quality of care.

But Loretta, they pledged to keep up the quality? Cynic!!