Arbor Update

Ann Arbor Area Community News

M-Care Blues

12. September 2006 • Chuck Warpehoski
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The MLive Business News reports that Blue Cross is to buy M-Care

According to the story, Dr. Robert Kelch, U-M’s executive vice president for medical affairs, said M-CARE would require major investments to stay competitive in today’s market and the insurance company diverts attention from the university’s core activities.

Now those without health insurance have fewer options of companies providing coverage they can’t afford.



  1. Chuck,
    your last sentence doesn’t make much sense. Those who can’t afford health insurance have no options, no matter who combines or doesn’t combine with whom.
    Unless you are using this story as a pretext to discuss the problems of the under- and non-insured.


       —Tom Brandt    Sep. 13 '06 - 11:50AM    #
  2. chuck, as someone without health insurance, i completely understand your last sentence.


       —tim    Sep. 13 '06 - 12:02PM    #
  3. Okay, is anyone else worried about the cryptic reference to “consumer-driven health plans” (which refers to things like “health savings accounts” that shift the burden onto employees)? It’s not just about the uninsured—being “insured” is going to mean less and less under this kind of system. Has any reporter tried to find out what this means for people now insured under MCare?


       —ann arbor is overrated    Sep. 13 '06 - 03:28PM    #
  4. According to this Detroit News article , “Coverage through the Blues will be as good as what has been offered under MCARE, Kelch said.”, whatever that means.


       —Tom Brandt    Sep. 13 '06 - 03:46PM    #
  5. Most of the articles say that there will be minimal changes in coverage between M-CARE and Blue, and that seems reasonable to expect (any insurance experts want to weigh in on what they see as the similarities and differences between pre-merger M-CARE and Blue?).

    The biggest change I expect to see is that a lot of folks in Ann Arbor and Southfield may be out of a job soon—with no severance pay. Okay, make that 2 changes, I also wouldn’t want to have a complicated claim going through M-CARE during the transition, ‘cause I expect it will get messy.

    That said, I think AAIO makes a good point about the shifts in the health coverage sector in general. I know a lot of people who are underinsured. For example, their deductibles are so high that they avoid going to the doctor at all.

    When I came to town my first job was temping at the University Hospital. I was working for doctors but I didn’t have health insurance. Mary Sue was talking a lot about the need to address the problem of the uninsured, and I remember wishing she’d start at home.

    (and yes, Tom, my comment was meant to be a bit silly and nonsensical. I guess I should get over my aversion to emoticons :-] )


       —Chuck Warpehoski    Sep. 13 '06 - 04:09PM    #
  6. Although I’m far from an expert in health care policy, I think there are some things consider:

    1) It’s not the fault of M-CARE or BCBSM that no one can afford insurance. If there were a way for BCBS or M-CARE to make money selling insurance for $20/mo they would most likely do so. This isn’t going to change without massive government intervention.

    2) UMHS owning M-CARE never made much sense, in that their goals are at odds. One wants to make money on people going to the hospital. One wants to save money by keeping people as far from the hospital as possible.

    3) M-CARE is run very independently from the U as it is. From a management and operations perspective, it’s probably a lot of dead weight for UMHS to be hauling around. M-CARE just doesn’t fit in with what UMHS does (research, fix sick people, education).

    It definitely sucks for everyone at M-CARE, though. A lot. It sounds like there were a lot of shocked people last week when this was announced, even though it seems like this has been in the works for a long time.


       —P    Sep. 13 '06 - 04:30PM    #
  7. As a former M-Care customer, I was very happy with the plan. I think that saying M-Care “wants to save money by keeping people as far from the hospital as possible” is over-simplifying things. I never had a problem with getting care.


       —Tom Brandt    Sep. 13 '06 - 04:40PM    #
  8. P is right, I don’t blame M-CARE for the high cost of care and insurance. There are deep structural problems that are out of the control of any single company, provider, employer, or hospital can address (Yes Magazine has a great comparison chart of different health systems from single payer to coproprate to socialized).

    And of course, there are different ways to keep people away from hospitals. Prevenative care is one. Denying benefits is another. P makes a good point that the financial incentives for insurers and health-care providers are different.


       —Chuck Warpehoski    Sep. 13 '06 - 04:48PM    #
  9. re: “If there were a way for BCBS or M-CARE to make money selling insurance for $20/mo they would most likely do so.”

    According to Friday’s Detroit News article about the (then-rumored) sale, “MCARE turned a $15 million profit in 2005.”

    re: “UMHS owning M-CARE never made much sense, in that their goals are at odds. One wants to make money on people going to the hospital. One wants to save money by keeping people as far from the hospital as possible.”

    One of the goals of M-CARE was to ensure that when subscribers did get healthcare, it was delivered predominantly by UMHS providers.


       —W.P. Fleischmann    Sep. 13 '06 - 09:33PM    #
  10. The umich web page has a linke to an M-CARE update with more details.

    In particular, “For the University of Michigan’s employees, graduate students and retirees, and their covered dependents or survivors, existing M-CARE products will remain in place through 2007. For 2008, the University will work with the Blues to have a health plan intended to provide the same level of benefits and choice as the University’s current M-CARE offerings.”

    On the issue of existing M-CARE employees: “The more than 400 U-M employees who work for M-CARE, who were notified of the possible sale this morning, will be retained until the sale is final. Once the sale is final, many M-CARE employees will be retained by U-M under a lease agreement to provide services to Blue Care Network for a period of time through the transition. How many employees hasn’t been determined. After that time, we’ll assist employees in transitioning to positions at BCBSM, Blue Care Network, other areas of U-M or the community. We will apply the U-M Reduction in Force policy and the federal Worker Adjustment and Retraining Notification Act, which provides for at least 60 days’ notice, with 90 days’ notice for employees with 10 or more years of service.”


       —Bruce Fields    Sep. 14 '06 - 01:30AM    #
  11. AS an MCare customer, I have to say it is better than the health insurance I had when working in private sector/corporate America.


       —Just a homeowner    Sep. 14 '06 - 02:50PM    #