How much profit did Blue Cross make?

Lew Borman, a spokesman for Blue Cross Blue Shield, says a recent radio ad from the State Employees Association of North Carolina gets the figure wrong. 

The ad claims that Blue Cross made $180 million running the State Health Plan.

Borman said that figure is "totally incorrect."

He said the profit margin on the administrative-services-only contract is .625 percent, or $478,000 last year.

Borman called the ad "a gross mischaracterization" of Blue Cross' role and profits and said it took a "cheap shot" at the company's executives.

"They miss the point," he wrote in an e-mail to Dome. "The real issue is the (State Health Plan's) inability to forecast and pay the growing medical costs."

Blue Cross and Blue Shield of North Carolina donated $643,000 to state politicians from the 2000 election cycle through 2008, the election watchdog group Democracy North Carolina says.

No other company the size of Blue Cross has donated more to state politics, the organization said in a news release Tuesday. The political action committees of seven other companies, such as banks and utilities, have given more, but they are larger than Blue Cross and operate in multiple states, reports Dan Kane.

Sen. Tony Rand, the Democratic majority leader and chairman of a Senate committee on employees’ hospital and medical benefits, received $36,000 from Blue Cross, making him the top recipient, Democracy North Carolina said. The second highest recipient was Senate leader Marc Basnight, who received $35,000.

Blue Cross, the state’s largest health insurer, administers the health insurance plan for state employees. The health plan is supervised by a legislative body.

"This arrangement puts legislative leaders in the awkward position of monitoring themselves," Democracy North Carolina said in a news release Tuesday. "When substantial political money flows from insurers to legislators, the awkward position becomes more problematic to a skeptical public, even when legislators are doing their best to protect the public interest."

Read more after the jump.

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Officials with Blue Cross and Blue Shield of North Carolina and the State Health Plan say there's no need to call for an audit of a contract between the two for administrative services.

They note that the State Auditor is in the midst of a performance audit of the plan, which would likely include a contract review, Dan Kane reports.

"A Performance Audit of the State Health Plan by the State Auditor is currently underway," plan spokeswoman Linda McCrudden said. "Once completed and released, the audit report will be available to the public."

Adam Searing of the N.C. Justice Center's Health Access Coalition, one of two groups that called for the audit, said he is aware there is a state audit under way, but the groups are calling for something different.

"We want something done pretty quickly — I don't know where the state auditor is — and we want something that focuses directly on this contract process (by) someone who really understands in depth the whole contracting process among health plans and employers," Searing said.

Moare after the jump.

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