By John Archibald
It's good to be the king. The big blue king that rolls around on his pile of money and uses it to grab even more.
Think about it. Just two years ago, the federal Department of Health and Human Services looked at the way Alabama reviewed health insurance rates, and said ... Ugh. It doesn't work. It is ineffective. And since Blue Cross Blue Shield of Alabama has a virtual monopoly on health insurance in the state, it meant Alabama regulatory reviews of Old Big Blue were just as ... Ugh. Ineffective.
And now look how far we've come. The top 10 executives at Blue Cross Blue Shield have been very good to themselves in recent years, doubling their own pay between 2011 and 2013. In 2013 – the last year available -- they each made more than a million bucks, a combined $19.2 million. So last year when AL.com wrote about that pay and the raises – as we are wont to do of big fat corporate pay in the middle of "ineffective" rate reviews – the Blue King said tut, tut, tut. And it used the power it bought by flooding Alabama politics with cash, to get what it wanted: Secrecy.
It has poured almost $700,000 -- $698,750 to be exact – into Alabama's campaign finance system since spring of 2013, and the juice pays off. For after Blue Cross execs dealt with the embarrassment of being outed as millionaires, they did what every Big Mule in Alabama has ever done. They got their bought-and-paid-for Legislature to save them from their own future mortification.
Sen. Slade Blackwell, a Republican from Jefferson County, sponsored a bill during the regular legislative session this spring that – while being touted as a way to make work papers confidential for accreditation reasons, added the big blue nugget to render executive pay for insurers confidential. Holy royal treatment, Batman. It is of special significance to Blue Cross, as AL.com reporter Amy Yurkanin put it so well when she learned of the bill, because other insurers must report top salaries to the Securities and Exchange Commission or the IRS. Not Blue Cross. Execs there can pay themselves what they want, with customers none the wiser. The bill sailed through the greased Legislature with almost unanimous support from lawmakers who – let's face it -- would sooner gnaw off a thumb than thumb their noses at Blue Cross. The money is just too good. Blue Cross has not contributed directly to Blackwell. But over the last two-plus years it did give $336,000 to PACs that gave Blackwell $53,250. And it might be more. Blackwell has not been required to report contributions this year. UnitedHealth gave him another $1,500. Blackwell said "political campaign contributions have no impact on the legislation that I sponsor or the votes I cast. This legislation was approved without a single opposing vote, which reflects its strong bi-partisan support." He said the bill protects the interest of consumers and provides adequate authority for regulators to do their jobs. It does more than that. It lets big business use big money to write their own rules.
Why care? Because Alabama's rate review process is sketchy already. Because Blue Cross already has what amounts to a monopoly, because how it spends its cash has a direct relation to whether rates are reasonable. Blue Cross has maintained its executive pay has nothing at all to do with rates. But that's like saying the amount you spend on liquor in bars has nothing to do with the fact that you're broke and hung over. How much do Blue Cross executives make right now? Your guess is as good as mine. Because it's none of your business. The Alabama Legislature said so.
It's good to be the king. Or his Montgomery jesters. But it kind of stinks to be his serfs.