Jun 24, 2008 10:51 am US/Mountain
Kaiser Agrees To Improve Health Benefits In Colo.
By Steven K. Paulson, AP Writer
DENVER (AP) ―
Kaiser Permanente has agreed to provide credits and improved benefits worth $155 million to Colorado customers after state officials expressed concern over large sums the health-care giant was sending to affiliates in California.
Under a deal announced Tuesday, Colorado subscribers to Kaiser's individual family plans will get a one-time credit of $287, equal to an average one-month premium.
Employers who provide Kaiser coverage will get a one-time average credit of $287 for each enrolled employee. Employers can keep the money, pass it on to employees or use it to increase benefits.
The company also agreed to provide an additional $2.5 million a year for the next two years for low-income customers in Colorado.
Colorado officials started negotiating for a better deal from Kaiser a year ago after noting the nonprofit's reserves were growing and that the benefits were going to affiliates in its home state of California.
"We felt that should be examined and we believe that money should be staying here in the state," Colorado Insurance Commissioner Marcy Morrison said.
Morrison said the agreement avoids a protracted and expensive legal battle and expands Kaiser's coverage in Colorado.
Kaiser has 480,000 members and 5,000 employees in Colorado.
Kaiser's Colorado president, Donna Lynne, said that unlike for-profit insurance companies, Kaiser maintains its own laboratories, pharmacies and other facilities. She said for-profit insurance companies return their profits to shareholders.
She said the company agreed to the settlement because it meshed with its plans to expand service, focusing on southeastern Colorado.
"We're very different from all of the other insurance companies in the state of Colorado because we're what we call a delivery system. We own medical office buildings, we own pharmacies, we own labs, and as such, it's very important for us in delivering health care through our insurance system to also have a strong and vibrant delivery system," she said.
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