Blue Shield Of California To Give Back Millions To Policyholders

SAN FRANCISCO (KCBS) – Blue Shield of California promised Tuesday to cap its profit margin and give any extra money directly to policyholders.

Because the pledge applies retroactively, 2010 Blue Shield customers will start getting credits this year.

Blue Shield of California CEO Bruce Bodaken said in years when profits go over two percent of revenue, the company will return any excess profit to policyholders.

“This is a step Blue Shield is taking to address the cost of care and insure that affordability is put before profits,” Bodaken said.

KCBS’ Anna Duckworth Reports:

The company has been under fire in recent months for steep policy hikes and for Bodaken’s high salary – more than $4 million last year.

Shana Alex Laverreda with UCLA’s Center for Health Policy Research said the $167 million going back to policyholders for excess profits from last year is a move to smooth those waters and keep customers from leaving Blue Shield.

“The problem is that $167 million sounds like an awful lot of money, but really when it gets down to the individual, and the individuals are the ones making the decision whether or not to stay with Blue Shield, they’re only going to be getting about $80,” she said.

Blue Shield’s 30 percent credit will go back to policyholders on one of this year’s monthly bills. It does not apply to those with employer plans.

(© 2011 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

  • CC

    I won’t see a penny. My husbands insurance is through his work, My expired individual plan is probably out of date for their refund.
    Sorry, I still can’t afford you Blue Shield.

  • JaneQPublic

    Ratepayers MIGHT get $80 – and the CEO gets paid $4 MILLION????


    Too little too late, Blue Shield. The president of the ENTIRE country doesn’t get paid one-eighth of that and has a lot more responsibility. Blue Shield’s obscene CEO pay is GOUGING!


    What a shoddy report.

    First, is it too much to ask that the name of BSC’s Chairman & CEO be pronounced correctly?

    Second, the statement that Groups will not receive any credits on their upcoming premium statements is flat-out wrong. ALL the materials that were released by BSC including on its internet site and Mr. Bodaken’s statements, clearly indicate fully-insured Groups will receive the same 30% credit that is going to individual policy-holders.

    Third, is hardly without its own agenda and this should have been pointed out in this story. Additionally, ConsumerWatchdog consistently uses incorrect terms when speaking of BSC. BSC is not a “non-profit” company and has never portrayed itself as such. The company is a “not-for-profit” corporation based in California. This distinction is very important but does not suit ConsumerWatchdog’s agenda so they misstate facts and the obvious to serve their own purposes. Any first-year journalist would have pointed this out in their report.

    Fourth, do you honestly think a policy decision as announced by BSC could be arrived at in a matter of weeks in response to negative press reports and legislation in California? Something of this magnitude takes months of study to put into place.

    Any third grader could have done a better story than did CBS5. I was very disappointed.

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