Lucas Hamilton, communications and policy director for the Insurance Commissioner's office says expect Leaphart's opinion is expected "before the end of April." Lindeen told a local paper Fox's agreement with HCSC officials for a March deadline was "premature." At issue is that both Fox and Lindeen have to approve the agreement before it can go forward with or without modifications.
The long and complicated road to approving HCSC's purchase is due, in part, to Montana's conversion law, which is being tested out for the first time, says Hamilton. Passed in 2005, the law is meant to protect the state's consumers if a nonprofit health plan converts to one that is for-profit.
HCSC, also a nonprofit, has said the company's business status would not change. But under Montana's law, the deal has to be brokered as if the insurer was converting to be for-profit because Lucas says HSCS has stipulated to the conversion statute, and BCBSMT is legally losing its nonprofit license.
For Montanans, that means that a nonprofit foundation has to be set up from BCBSMT's current surplus, which is estimated to be $100 million, plus the purchase price, which is now $40.2 million. The AG's office would be responsible for determining how the $140 million trust would be used, though the law spells out that it must be for the public good.
Chicago-based HCSC is a non-investor owned (NIO) mutual insurance company doing business as a nonprofit health plan. It is an independent licensee of Blue Cross Blue Shield Association and operates BCBS plans in four states: Illinois, New Mexico, Oklahoma, and Texas. HCSC has more than 13 million members.