WILLIAMS TESTIFIES IN SUPPORT OF INSURANCE MERGER

            PHILADELPHIA, July 15 – State Sen. Anthony H. Williams will testify today at 11 a.m. at the Sheraton Philadelphia City Center Hotel, in support of the merger between Independence Blue Cross (IBC) and Highmark.  By combining, the companies plan to use savings to support new services and their respective communities.

            A series of public hearings are being held by the Pennsylvania Department of Insurance to field comments about the potential merger.

            “By working together, IBC and Highmark will be able to invest additional money to help the uninsured in Pennsylvania,” Williams said.  “Providing insurance for all residents of Pennsylvania is a continuing mission, and these companies can help us achieve that goal.”

            Williams, senator for Pennsylvania’s 8th District, represents over 106,000 people covered by IBC, 43 percent of his district.  Williams also serves on the board of Kids Smiles, which operates two clinics in his district. These clinics are funded by the IBC Charitable Medical Grant Program, which helps serve more than 100,000 under and uninsured people in Philadelphia.

            Under the proposed merger, the two insurers report potential savings of $1 billion, which will be reinvested into the company and for people in need. 

• New services and technology (i.e. Electronic personal health records, e-prescribing tools and real-time claims adjudication) will help doctors and insurers respond faster to patients.
• Purchasing prescriptions in larger quantities will help cut-down costs for the company and the consumer.
• Decreased administrative costs and other savings will generate $650 million to help cover the uninsured through the Children’s Health Insurance, adultBasic, and Special Care programs. 

            According to the latest report from the Pennsylvania Department of Insurance, 8 percent of Pennsylvanians were uninsured.  Gov. Ed Rendell said in April that close to 85,000 people were on the waiting list to receive adultBasic, a number that could significantly decrease with additional funding-coming from the savings from the merger. 

           According to the Kaiser Family Foundation, uninsured adults are three times more likely to delay seeking medical attention, often until more severe, and costly, treatment is required.  Efforts to provide coverage to the previously uninsured aim to protect health care providers from absorbing these high costs, leading to lower rates for consumers.       

           Opponents argue that the merger would decrease competition in Pennsylvania; however, the U.S. Department of Justice and the Federal Trade Commission disagree.  Executives at the two companies emphasize that competition between Blue plans, insurers under the national Blue Cross Blue Shield umbrella, only decreases efficiency and resources. 

            Nationwide, 44 states have only one Blue plan.  Pennsylvania is the only state with four Blue plans, the largest amount in the country.

            In March 2007, IBC and Highmark announced their intentions to combine, and PID began soliciting public comment two months later.  Since then, the Senate Banking and Insurance Committee and PID have held hearings, which will eventually result in a decision about the merger.

            The first hearing was held on July 8 in Pittsburgh, followed by one on July 10 in Harrisburg.

            Williams serves on the Senate Banking and Insurance committee, which heard testimony from the president and chief executives of IBC and Highmark, Joseph Frick and Kenneth Melani, last October.

            “At a time when many Pennsylvanians are struggling, Independence Blue Cross and Highmark will be able to provide much needed assistance to their patients, both old and new,” Williams said.