Health plan conversions: the view from Blue Cross of California.
نویسنده
چکیده
THE TWENTIETH OF MAY 1996 marked an important milestone for Blue Cross of California (BCC), WellPoint Health Networks, and the people of California. BCC completed its conversion to for-profit status, thus creating one of the nation’s largest charitable foundations and a national health care company. This date marked the successful culmination of a three and one-half year regulatory process and set the standard by which future for-profit conversions will be judged. Unfortunately, the process lasted far too long; the delay adversely affected the value of the assets that were transferred to the two foundations created to sustain the BCC public benefit mission. This essay focuses on key events and critical issues that shaped the restructuring of BCC and its conversion to a for-profit corporation under WellPoint Health Networks. Three lessons emerge from the experience that might be of value to regulators, legislators, and consumer groups. First, no one was well served by the lack of a clear and certain process that governed restructuring and forprofit conversions. Second, a structure that mixes nonprofit and for-profit activities can cause confusion and lack of confidence for customers, employees, shareholders, regulators, legislators, and other stakeholders. Third, before a restructuring or conversion begins, two questions must be resolved: Who owns the assets of the converting company, and how are these assets valued? B ackground BCC was founded as a nonprofit public benefit corporation in 1937. As such, BCC had certain federal and state tax advantages that helped it to meet its public benefit mission: to provide Californians with high-quality, affordable health care coverage. As is the case with all public benefit corporations, all of its assets were dedicated to charitable purposes. For nearly sixty years BCC fulfilled its commitment to the people of California. Then things changed. l 83
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عنوان ژورنال:
- Health affairs
دوره 15 4 شماره
صفحات -
تاریخ انتشار 1996