I just submitted to Blue Cross Blue Shield of Massachusetts the letter shown below, which I was motivated to write after my latest monthly billing statement arrived. The letter was originally published for public viewing and comment at PlanetFeedback.com.

To: Cleve L. Killingsworth, CEO, Blue Cross Blue Shield of Massachusetts
Cc: Blue Cross Blue Shield of Massachusetts Executive Board (Carl Ascenzo, Stephen Booma, Andrew Dreyfus, John Fallon, Sandra Jesse, Allen Maltz, Peter Meade, Joseph Patrnchak, Vinod Sahney, John Schoenbaum, Fredi Shonkoff); Governor Mitt Romney; State Senator Richard R. Tisei; State Representative Bradley H. Jones Jr.; The Boston Globe; The Boston Herald; Michael Moore; Healthcare for Massachusetts Campaign
Date: November 19th, 2006, 5:12 pm
Subject: Blue Cross Blue Shield of Massachusetts gouges subscribers

I am self-employed. My wife works part time. Because of this, we have to pay out of pocket for healthcare coverage for our family, which, in addition to the two of us, includes our 3-year-old son and 1-year-old daughter.

We began subscribing to Blue Cross Blue Shield of Massachusetts’ HMO Basic Blue Direct (w/ no prescription coverage) in October of 2005, at which time our monthly premium was $619.56. We were told when we began our subscription that there would be a rate increase in December of 2005, which the representative to whom we spoke at the time told us would be in the 8% range. We were slightly annoyed when, in November, our statement for the period covering 12/01/05–12/31/05 jumped to $676.85, an increase of 9.25%.

It is now one year later, and we just received our latest billing statement for the period covering 12/01/06–12/31/06, in which a new rate change is reflected. Our monthly premium has now jumped to $808.75. This is an increase of roughly 19.5% per month.

In other words, our premium has jumped about 30% in the span of 13 months.

The following was printed in a Nov. 16, 2006 article published in the Boston Globe (”State’s major health insurers report mostly positive results”):

“Blue Cross Blue Shield of Massachusetts, the state’s largest health insurer with about 3 million members, saw its operating income decline by about one-third to $66.4 million for the third quarter, as premiums increased from $1.4 billion to $1.6 billion … Net income for Blue Cross, including its HMO operation, increased to $140.1 million, up from $103.2 million.”

As noted in the excerpt, this reflects the third quarter of 2006, and therefore doesn’t reflect the windfall BCBSMA is likely to enjoy thanks to the 19.5% increase it has imposed upon its subscribers at the end of Q4 2006.

For the year 2005—11 of the 12 months for which took place prior to the 9.25% increase of that year—BCBSMA Chairman William Van Faasen earned a salary and bonus of nearly $3.2 million, and that was despite the fact that he gave up his position in July of 2005; Cleve L. Killingsworth, his replacement, earned a salary and bonus of $1.4 million over the remainder of 2005.

These two men earned a combined total of $4.6 million for their respective partial-year incomes.

I understand that we live in a capitalist society, and I have no problem with a company trying to increase its bottom line. I do, however, have a massive problem with a company whose business is the health and well-being of the majority of insured persons in the state of Massachusetts raking its subscribers over the coals to the tune of a 30% increase over a roughly one-year span while its bottom line balloons and its executives pocket astronomical sums of money.

My wife and I aren’t willing to gamble with our family’s, and particularly our children’s, healthcare coverage … so we will dig ourselves further into debt to meet your exorbitant demands (albeit while looking for a better alternative). No doubt, however, there will be thousands of families who, because of this extortion-like increase, will be forced to drop their coverage. This is both sad and reprehensible.

If ever an example was needed of what is wrong with the managed healthcare system in America, surely the situation I have described herein would be a good place to start … though it would likely pale in comparison to the stories of those families who have to not only keep up with your insane premium increases, but have to do so while managing major health crises.

This is, in my opinion, gluttony and greed of the worst kind, and I am both disgusted and outraged by this situation. Sadly, I’m sure that my disgust and outrage will amount to nothing, and the Killingsworth and Van Faasen families, as well as the families of the rest of BCBSMA’s executive board, will enjoy a bountiful holiday season while my wife and I try to figure out how to manage a $132-per-month healthcare-premium increase right in the midst of the holidays, and for every month thereafter (until BCBSMA jacks up the price again, that is). So thank you not only for this despicably huge increase, but for ramming it down our throats at what is already one of the most financially stressful times of the calendar year. I can only hope you get your come-uppance.

Disgustedly yours,

-Jon M. Zahlaway Jr.

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