Tuesday, January 29, 2008

HIP-GHI Conversion Nearly Complete

On Tuesday, January 29th at the HIP headquarters in Lower Manhattan, so many people showed up for a public hearing that by 10:00 am the hearings were temporarily closed to the public. Those who wanted to enter the only public hearing being held in NYC had to wait up to six hours to testify. The majority were against the merger and conversion that would turn GHI and HIP from two separate non-profit entities into one for-profit company, EmblemHealth.
The President of the Medical Society of the State of New York, Dr. Robert Goldberg, who also testified at the hearings believes the conversion of the GHI-HIP insurance company would have a negative impact on patient care and payments to physicians.

This new company will be the largest single health plan in the state, with over four million members and $7 billion in revenue and would dominate the New York metropolitan area. In particular the municipal unions, as over 90% of their members will now be subscribers in this new company. The original merger began in 2005, but was blocked by the mayor until 2006. In November 2006, they were approved by state regulators to operate as affiliates under a governing foundation. While the union is known as EmblemHealth, the companies continue to function under their own names.

At the hearing it became clear that no one knows what the future holds for this new company. In particular, the billions of dollars that will be made when it becomes a private company. One group, New York City union leaders, want their members to become part of any profit sharing model. As Randi Weingarten, President of the UFT put it " .. We want our members, the dedicated city workers who are the real stakeholders who have contributed to the value of HIP/GHI for decades, to get a fair share of the proceeds should the HIP/GHI conversion to a for-profit move forward."

In the past, large company mergers have led to layoffs of long-term workers. To date, at least 160 union workers from HIP have lost their jobs due to this conversion. In addition, non-profits that convert to for-profit health organizations traditionally raise the prices for the cost of care. This is the reason most experts in the medical field believe single payer health care is the better way to go.

A second public hearing is scheduled for Jan. 31 in Albany.

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