Senate OKs changes to insurance bill STATE HOUSE REPORT

April 06, 1993|By John W. Frece | John W. Frece,Staff Writer

The state Senate last night backed amendments sought by Blue Cross and Blue Shield of Maryland that the state insurance commissioner contends will weaken a bill designed to bolster regulation of the state's largest health insurer and possibly threaten its passage.

"The insurance commissioner is not going to tell us how to run the state of Maryland," declared Sen. Thomas P. O'Reilly, the Prince George's County senator who chairs the Finance Committee and who has had a running feud with Insurance Commissioner John A. Donaho.

Last week, the Finance Committee adopted a dozen amendments to a House bill aimed at assuring the solvency of the state's largest health insurer. Almost all of the changes were proposed by Blue Cross.

Mr. Donaho, in a letter to Blue Cross President William Jews, said he feared the House will never go along with the amendments, and said it would be "a disaster" if the bill is not passed. Mr. Donaho urged Mr. Jews to work with him to get the bill passed, but warned that if it does not, he will use his authority to raise Blue Cross' required surplus to a level that would drive the nonprofit

company into insolvency and probable state control.

Mr. Donaho first announced his deep concerns about the financial health of Blue Cross before a U.S. Senate committee last summer. He met with Blue Cross officials yesterday and intends to meet today with them, legislators and others. Last night, Mr. O'Reilly suggested that Mr. Donaho might be partly to blame for the financial problems Blue Cross experienced, saying, "I complained to the insurance commissioner month after month, year after year, and all I got was nonanswers."

In defending the Senate amendments, Mr. O'Reilly said the commissioner and the House had done what politicians often do after a problem erupts: They overreacted.

"Perhaps that's good down on Capitol Hill for Mr. Donaho, and it plays good down here in the press," Mr. O'Reilly said sarcastically.

Despite modest opposition, the full Senate approved 11 of the 12 amendments and delayed action on the 12th. Additional changes to the bill are expected to be proposed when it comes up for a final vote this week.

Once approved by the full Senate, the bill will be sent to a joint conference committee to work out differences with the House.

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