Maryland insurer gets Blues license back

CareFirst is keeping its Blues identification, but the state medical society says bringing real changes to the company will be a difficult task.

By Robert Kazel, AMNews staff. June 23, 2003.

Maryland's medical association sharply criticized the national BlueCross BlueShield Assn. this month for briefly pulling the Blues license of CareFirst BlueCross BlueShield in Maryland amid a dispute over how big a role state government should play in the makeup of CareFirst's board.

The short-lived severance of CareFirst's license by the Blues association, which came after the state of Maryland passed a law that would keep the company nonprofit and fill its board with state appointees, was not in the best interest of patients and represented "a perversion of good corporate governance," said Michael Preston, executive director of MedChi, the Maryland State Medical Society.

Although the deal worked out June 6 between Maryland's Justice Dept., insurance officials and the Blues association lets CareFirst keep its license, many doctors in the state believe a more dramatic "regime change" in board members and executives would have been preferable and are doubtful that significant reforms will take place at CareFirst, Preston said.

Preston said MedChi was happy that the licensure issue was resolved and that plan members won't find themselves suddenly out of the Blues system. But he questioned the ability of the Maryland insurer to turn itself around to the satisfaction of members and doctors in light of the main concession agreed upon by Maryland officials -- a reduction in the number of CareFirst board members who were to be immediately replaced by nominees of a governor's committee.