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For Immediate
Release
3/28/07
CONTACT:
Joe Pittman
(717) 787-8724 or (724) 541-0552
PA
Senate Republican Communications
(717) 787-6725
 
Senate Approves Senator White's Merger Bill
Senate Bill 550 would ensure state oversight of health insurance deals
Floor Remarks of Senator Don White
The Senate today
approved Senate Bill 550, legislation introduced by Senator Don White, Chairman
of the Senate Banking and Insurance Committee, which would give the Pennsylvania
Department of Insurance oversight power over mergers involving health care
insurers such as Blue Cross and Blue Shield.
"The proposed
deal between Highmark Inc. (Highmark Blue Cross and Blue Shield) and
Independence Blue Cross (IBC) clearly demonstrates the need for state
oversight as a way to ensure a complete review of the ramifications of
mega-mergers between health care service corporations like Blue Cross
and Blue Shield," Senator White said.
"I am extremely
pleased the Senate expeditiously approved this important bill and I hope
the House will act just as quickly," Senator White said. "It is
important to note the provisions of Senate Bill 550 apply to any merger
established on or after January 1, 2007, so passage of this legislation
ensures a Department of Insurance review of the proposed Highmark-IBC
merger."
The Department
of Insurance already has oversight power over mergers involving
for-profit companies. SB 550 would bring deals involving health service
plans under the same standards of the Holding Company Act.
Senator White
said the long-term ramifications of a mega-merger of the two largest
health care insurers in Pennsylvania could impact the quality and
availability of health care coverage in the Commonwealth.
"The
Commonwealth must support policies that encourage and promote
competitiveness in the health care insurance market." Senator White
said. "Giving the Department oversight power is an important step in
ensuring that mergers of these companies do not result in a virtual
monopoly in the industry."
Senator White
said he's planning to study the Highmark-IBC proposal and will likely
call a public hearing.
"We are talking
about the potential joining of the largest health care insurance company
in Western Pennsylvania with that of the largest insurer in Southeastern
Pennsylvania which raises a number of very serious questions," Senator
White said.
"Primarily, we
have to be concerned this merger could create a single, multi-billion
dollar, mega-entity which would crush what little competition remains in
Pennsylvania's health care insurance market," Senator White continued.
"Right now, the last thing we need in the Commonwealth is further
limitation on the competitiveness in the health care insurance market.
There are real concerns that costs will skyrocket, quality of care will
decrease and the insured will be stuck with the bill.
"I believe the
Banking and Insurance Committee should hold public hearings to discuss
this proposal, as well as the future of the health care insurance
market. As legislators, we need to be educated so we can better inform
the people of the Commonwealth about this proposed merger."
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