Highmark's affiliation with BlueCross scrutinized

Highmark's attempt to affiliate with a Delaware Blues company has been delayed after state Attorney General Beau Biden said he had a "number of serious questions" about the deal.

Biden pressed Highmark and BlueCross BlueShield of Delaware to explain why the proposed affiliation is necessary and whether any Blue Cross officers were promised "incentives" as a part of the deal. Biden's office said its review has already raised serious questions concerning this transaction. "It's [about] quality of care and access to care," Biden told the Delaware News Journal. "This transaction raises basic and clear-cut questions about both."

He also asked the companies for detailed information about the affiliation agreement, including Highmark's plans to outsource jobs that may result from the deal, planned uses of the Delaware company's cash reserves and details of the line of credit Highmark has offered BlueCross BlueShield of Delaware, according to Pittsburgh Business Times.

In addition, Biden wants a full explanation of BlueCross's contention that it is too small as a stand-alone to function in the current health insurance market. "We will ensure that all the necessary questions are asked and answered before this transaction proceeds," Biden said, according to NewsWorks.

BlueCross BlueShield is financially solvent, but has an aging computer network, which has been a problem for the company. Fines ranging between $25,000 and $125,000 have been levied against the company in recent years by the state insurance department, most related to computer network issues, notes the Business Times.

To learn more:
- read the Delaware News Journal article
- check out the Pittsburgh Business Times story
- see the NewsWorks piece

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