Blue Cross freezes rates to complete Medicaid expansion

Blue Cross Blue Shield of Michigan has agreed to freeze the rates for its Medigap plan for five years so that it can move forward with its purchase of a Medicaid company. The rate freeze, which affects 200,000 seniors with supplemental Medicare policies, is retroactive to Aug. 1 and extends through July 31, 2016, reports the Detroit Free Press.

Under the deal, Michigan Attorney General Bill Schuette won't contest the purchase of AmeriHealth Mercy, which Blue Cross and Independence Blue Cross are acquiring to help them expand into the national Medicaid market, Crain's Detroit Business reports. Schuette said in August that he would review the potential purchase to ensure it complies with state law that restricts insurers' ability to buy other insurance companies.

However, Blue Cross Vice President of Corporate Communications Andrew Hetzel said the deal with the attorney general's office wasn't simply financially driven. "Looking at the money is the wrong focus," he explained, notes The Detroit News. "What this allowed us to do is really partner with the best Medicaid managed care plan in the whole country and give us enormous expertise and capability to serve Medicaid consumers here in Michigan that frankly we did not have."

To learn more:
- see the Detroit News article
- read the Crain's Detroit Business article
- check out the Detroit Free Press article

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