STATE OF MAINE
DEPARTMENT OF PROFESSIONAL & FINANCIAL REGULATION
BUREAU OF INSURANCE
| In re: Application of Associated |
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| Hospital Services of Maine, d/b/a |
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| Blue Cross and Blue Shield of |
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| Maine, to Convert to a Stock |
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| Insurer and Voluntarily Liquidate |
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| and Dissolve ) |
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MAINE MEDICAL ASSOCIATION’S |
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REQUEST FOR ACCESS TO CERTAIN |
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BCBSME DOCUMENTS SUBJECT TO THE |
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SUPPLEMENTAL PROTECTIVE ORDER |
| In re: Application of Anthem Health |
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| Plan of Maine, Inc. to Acquire the |
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| Assets of Associated Hospital Service |
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| of Maine, d/b/a Blue Cross and Blue |
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| Shield of Maine, and Related Transactions |
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| Docket No. INS-99-14 |
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| (CONSOLIDATED) |
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By motion dated December 17, 1999, Associated Hospital Service, d/b/a/ Blue Cross Blue
Shield of Maine ("BCBSME") requested the issuance of a supplemental protective
order for portions of its response to the Superintendent’s Second Discovery Request.
The Superintendent responded to the request on February 18, 2000. In his Order on Blue
Cross Blue Shield’s Motion for a Supplemental Protective Order ("Order")
the Superintendent ordered that all of the documents identified by BCBSME would be
accepted as confidential, but stated that any party who has executed a confidentiality
agreement could seek access to the documents through negotiation with Blue Cross. Pursuant
to the Order, all requests for access were to be made no later than February 23, 2000, and
any motions for access must be filed by the Superintendent no later than February 28,
2000.
Pursuant to the Order and on behalf of Maine Medical Association ("MMA"),
Michel A. LaFond, Sulloway & Hollis, P.L.L.C., prepared a written request for access
to certain documents identified by BCBSME as in need of special confidential status. The
request was sent, via fax, to Melanie Charest and Robert Frank, Harvey & Frank,
counsel to BCBSME, on February 23, 2000. On February 25, 2000, Ms. Charest responded to
the request by e-mail, stating that she had discussed the contents of the request with
Attorney Frank, and that he had determined that some of the requests would be of
significant concern to BCBSME, while others were matters that could be resolved. Attorney
Frank is out of the country, however, and will not be available to discuss the request
until February 29. Accordingly, MMA hereby requests that the Superintendent enter an order
granting to Sulloway & Hollis, Reden & Anders, Attorney Gordon Smith and Attorney
Andrew MacLean, all of whom have signed Confidentiality Agreements, access to the
documents identified in the chart below, for the reasons stated therein.
Access to the documents identified below is necessary to facilitate a review and
analysis of the conversion and acquisition transactions on behalf of Maine Medical
Association. Maine Medical Association is a professional association of more than 2000
Maine Physicians. MMA was founded to unite and support the physicians of Maine in:
promoting the health of Maine’s Citizens; protecting and promoting the quality of
medicine; and supporting the physicians’ functions as advocates for their patients.
MMA seeks to evaluate the proposed transaction in light of these objectives. Specifically,
MMA seeks to determine how the proposed transaction will: (1) affect BCBSME provider
agreements; and (2) affect the provision of services rendered to subscribers. In order to
properly determine whether the proposed transaction will adversely affect either provider
agreements or the provision of services rendered to subscribers, counsel for MMA must have
access to the documents identified below.
| Request Number |
Nature of Request |
Document Number |
Reason Special Access Required |
| Superintendent’s 2nd
Discovery Request No. 2
|
Please provide a copy of the fairness
opinion of SalomonSmithBarney and documentation substantiating the supporting criteria,
including any related valuation analysis. Please provide a copy of any correspondence
between SalomonSmithBarney and BCBSME leading up to the award of the contract as well as
the contract |
BC 2000-2693 |
Physicians are the primary, and
substantially the only, persons licensed to diagnose and treat patients. As licensed
providers, physicians work on a daily basis with Hospitals and Community Health Clinics to
facilitate the delivery of healthcare services to patients. Physicians have been viewed
for decades as the primary caregiver and advocate for their patients. MMA has intervened
in this proceeding both as a representative of physicians who are patient advocates and
the principal providers of health care services to patients. In order to complete an
analysis of BCBSME’s conversion and acquisition by Anthem, MMA needs access to these
financial documents to determine whether the transaction is fair and helpful to Maine
patients and the community generally. |
| Superintendent’s 2nd
Discovery Request No. 44 |
Please provide a copy of the
administrative services contract between Blue Cross Blue Shield of Maine and Blue Cross
Blue Shield of Minnesota. To the extent not shown in the contract, please provide an
explanation of or documentation of any anticipated revisions to the contract following
BCBSME’s merger with Anthem, and Anthem’s plans for continued operation of the
contract following the expiration date. Also, please provide projections of revenue
generated by the contract, and include documentation of all assumptions supporting such
projected revenue amounts. |
B 01021-01171 |
MMA must understand the scope and
substance of BCBSME’s contract with BCBSMN in order to develop a more complete
analysis of the systems and claims payment capability and capacity of the BCBSME. This
information is needed as baseline information to be analyzed with comparable systems and
claims processing information concerning Anthem. This analysis will allow MMA to determine
whether the proposed transaction will benefit Maine patients and the community generally. |
| Superintendent’s 2nd
Discovery Request no. 46 |
Please provide a schedule of total
compensation (both current and deferred) paid to BCBSME senior management for 1997, 1998,
1999 and, as of March 1, for the year 2000. |
B 10029-31 |
Per the Superintendent’s Order on
Blue Cross Blue Shield’s Motion for a Supplemental Protective Order, Blue Cross is
required to file a redacted version of the salary and compensation spreadsheet with the
Superintendent. Please provide MMA with a copy of this spreadsheet. |
| Superintendent’s 2nd Discovery
Request No. 45 |
Please provide copies of all employment
agreements or retirement agreements currently in force with BCBSME management, and any
agreements contemplated within the proposed merger |
B 01172-01228 |
Physicians are the primary persons
licensed to diagnose and treat patients. As licensed providers, physicians work on a daily
basis with Hospitals and Community Health Clinics to facilitate the delivery of healthcare
services to patients. Physicians have been viewed for decades as the primary caregiver and
advocate for their patients. MMA has intervened in this proceeding both as a
representative of physicians and as a patient advocate. In order to complete an analysis
of BCBSME’s conversion and acquisition by Anthem, MMA needs access to these documents
to determine whether the transaction is fair and helpful to Maine patients and the
community generally. |
| Superintendent’s 2nd Discovery
Request No. 47 |
Please provide copies of all work papers
and communications documenting due diligence related to the competitive bidding process
followed by BCBSME, including consideration of other offers, and criteria utilized in
selecting Anthem as a merger partner. |
BC 00001-00291 BC 00883-00999 |
Physicians are the primary, and
substantially the only persons licensed to diagnose and treat patients. As licensed
providers, physicians work on a daily basis with Hospitals and Community Health Clinics to
facilitate the delivery of healthcare services to patients. Physicians have been viewed
for decades as the primary caregiver and advocate for their patients. MMA has intervened
in this proceeding both as a representative of physicians and as a patient advocate. In
order to complete an analysis of BCBSME’s conversion and acquisition by Anthem, MMA
needs access to these financial documents to determine whether the transaction is fair and
helpful to Maine patients and the community generally. |
| Superintendent’s 2nd Discovery
Request No. 55 |
Please provide copies of the most current
provider contracts for BCBSME (including HMOMaine, MPHP and CMPHP), including hospital
contracts, physician contracts, and mental health provider contracts. Identify any
provisions in each contract which vary from one contract to another. |
Responsive documents |
In the Superintendent’s Notice of
Hearing dated November 5, 1999, the Superintendent identified, among others, the following
two issues to be considered by the Superintendent in this proceeding: "(4) whether
Anthem Health Plan’s proposed plans or proposals to liquidate, sell the assets of, to
merge, or to make any other major change in the business or corporate structure or
management of BCBSME or its two HMO subsidiaries, Maine Partners and Central Maine
Partners, are unfair or prejudicial to policyholders or enrollees.
* **
(10) whether the terms and conditions of BCBSME’s proposed conversion plan are
fair and equitable; and whether BCBSME’s proposed conversion plan would adversely
affect, in any manner, the services rendered to subscribers."
Physicians are the primary, and substantially the only, persons licensed to diagnose
and treat enrollees. Provider contracts control, to a large degree, how a physician treats
his/her patients. MMA is concerned about how any changes to provider contracts will affect
the ability of members of MMA to provide services effectively and appropriately to
subscribers. |
| Superintendent’s 2nd Discovery
Request No. 56 |
Please provide a copy of the most current
pharmaceutical contract for each Third Party Prescription Program or other prescription
benefit offered by BCBSME (including HMOMaine, MPHP and CMPHP) |
B 01283-01314 |
Pharmacy costs have increased five-fold in
the last several years, and are projected to increase at a rate of more than 20% per year
for the next several years. Delivery of pharmaceuticals is material and central to a
physician’s delivery of health care services and the supervision, and coordination of
patient care. MMA is concerned about how any changes to these contracts will affect the
ability of members of MMA to provide services effectively and appropriately to
subscribers. |
| Superintendent’s 2nd Discovery
Request No. 63 |
Please update the business plan pro-formas
for BCBSME that have been filed to include: -Balance Sheets
- Additional detail of the components of operating expenses within the income statement
- Additional detail of the components of total revenues within the income statements
(premiums earned only, or other revenues also)
- Detail of change in surplus year-to-year through 2003
- Balance sheets and income statement on a statutory basis.
- Underlying per member per month information on a consolidated basis (filed by
segment) in addition to net income per member per month for 1997-2003. |
B 1004-1223; B 01732-01999;
B 01325-01327
B 100001-10028
Disks A-E |
Physicians are the primary, and
substantially only, persons licensed to diagnose and treat patients. As licensed
providers, physicians work on a daily basis with Hospitals and Community Health Clinics to
facilitate the delivery of healthcare services to patients. Physicians have been viewed
for decades as the primary caregiver and advocate for their patients. MMA has intervened
in this proceeding both as a representative of physicians and as a patient advocate. In
order to complete an analysis of BCBSME’s conversion and acquisition by Anthem, MMA
needs access to these financial documents to determine whether the transaction is fair and
helpful to Maine patients and the community generally |
| Superintendent’s 2nd Discovery
Request No. 74 |
The Analysis includes comparative balance
sheets for years 1996-2003 on both a conversion and a non-conversion basis. Please provide
corresponding income statements. In addition, please provide both balance sheets and
income statements on a statutory accounting basis |
See Disks A and Disks B-C. B 1004-1223;
B 01732-01999;
B 01325-01327;
B 100001-10028. |
Physicians are the primary, and
substantially only, persons licensed to diagnose and treat patients. As licensed
providers, physicians work on a daily basis with Hospitals and Community Health Clinics to
facilitate the delivery of healthcare services to patients. Physicians have been viewed
for decades as the primary caregiver and advocate for their patients. MMA has intervened
in this proceeding both as a representative of physicians and as a patient advocate. In
order to complete an analysis of BCBSME’s conversion and acquisition by Anthem, MMA
needs access to these financial documents to determine whether the transaction is fair and
helpful to Maine patients and the community generally. |
| Superintendent’s 2nd Discovery
Request No. 107 |
Please provide all work papers and
documents detailing key assumptions used by BCBSME in development of the model supporting
the valuation, mortality, morbidity, terms of provider contracts, medical costs, policy
lapses, expense charges, statutory reserves, cash flow reinvestment strategies, investment
expenses, investment defaults, and taxes. |
B 1333-1686; B 2000-3000;
B 4884-5496;
B 6585-7544;
B 9841-10000. |
MMA needs this information about BCBSME to
establish a baseline for its consideration of the impact of the proposed acquisition. MMA
is seeking an analysis of comparable information about other Anthem Blues to determine
whether providers subject to Anthem’s business plans and provider contracts will be
better able, or less able, to provide services effectively and appropriately to patients. |
| Superintendent’s 2nd Discovery
Request No. 109 |
Please provide a description of all
substantive management representations made to HLHZ and, to the extent not heretofore
provided, copies of all documents reflecting such. |
B 1333-1686; B 2000-3000;
B 4884-5496;
B 6585-7544;
B 9841-10000. |
Physicians are the primary, and
substantially only, persons licensed to diagnose and treat patients. As licensed
providers, physicians work on a daily basis with Hospitals and Community Health Clinics to
facilitate the delivery of healthcare services to patients. Physicians have been viewed
for decades as the primary caregiver and advocate for their patients. Therefore, MMA has
intervened in this proceeding both as a representative of physicians and as a patient
advocate. In order to complete an analysis of BCBSME’s conversion and acquisition
by Anthem, MMA needs access to these documents to determine whether the transaction is
fair and helpful to Maine patients and the community generally |
WHEREFORE, MMA respectfully requests a ruling that Sulloway & Hollis, Reden &
Anders, Attorney Gordon Smith and Attorney Andrew MacLean, all of whom have signed
Confidentiality Agreements, be granted access to the documents identified above.
Dated: February 28, 2000
Gordon H. Smith
Maine Medical Association
30 Association Drive
P. O. Box 190
Manchester, Maine 04351
207-622-3374
gsmith@ctel.net
Michel A. LaFond
Sulloway & Hollis, P.L.L.C.
Attorney for Maine Medical Association
9 Capitol Street, Box 1256
Concord, New Hampshire 03302-1256
603-224-2341
603-226-2405 - fax
mal@sulloway.com
CERTIFICATE OF SERVICE
The undersigned hereby certifies that on February 28, 2000 a copy of Maine Medical
Association’s Request for Access to Certain BCBSME Documents Subject to the
Supplemental Protective Order was served via United States mail, first class postage
prepaid, on each of the persons listed below.
| Robert S. Frank, Esq. |
Michele M. Garvin, Esquire |
| Harvey & Frank |
Ropes & Gray |
| Two City Center |
One International Place |
| P.O. Box 126 |
Boston, Massachusetts 02110-2624 |
| Portland, Maine 04112 |
e-mail: Mgarvin@Ropesgray.com |
| e_mail: frank@harveyfrank.com |
(Central Maine Healthcare Corporation; |
| (Blue Cross/Blue Shield of Maine) |
Central Maine Partners Health Plan) |
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| Judith Chamberlain, Esq. |
Robert I. Goldman |
| State of Maine |
Maine Counsel of Senior Citizens |
| Department of the Attorney General
|
27 Bowery Beach Road |
| 6 State House Station |
Cape Elizabeth, Maine 04107 |
| Augusta, Maine 04333_0006 |
e-mail: Rgoldma1@maine.rr.com |
| e_mail: judy.chamberlain@state.me.us |
(Maine Council of Senior Citizens) |
| (Bureau of Insurance) |
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|
Bonnie Post |
| William H. Laubenstein, Esq. |
Executive Director of the Maine
Ambulatory |
| State of Maine |
Care Coalition |
| Department of the Attorney General
|
P. O. Box 390 |
| 6 State House Station |
Manchester, Maine 04351 |
| Augusta, Maine 04333_0006 |
e-mail: bdpmacc@mint.net |
| e_mail:bill.laubenstein@state.me.us |
(Sacopee Valley Health Center,
Regional |
| (Office of the Attorney General)
|
Medical Center at Lubec, Eastport
Health |
|
Care, Inc., and the Maine Ambulatory
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| Gregory A. Brodek, Esq. |
Care Coalition) |
| Duane, Morris & Heckscher, LLP |
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| 15 Columbia Street, 4th
Floor |
John Dieffenbacher-Krall |
| Bangor, Maine 04401_6355 |
Executive Director |
| e_mail: gabrodek@duanemorris.com |
Maine People’s Alliance |
| (Maine Health Alliance) |
192 State Street |
|
Portland, Maine 04101 |
|
e-mail: MPA@gwi.net |
|
(Maine People’s Alliance) |
| |
|
| Joseph
P. Ditre, Esq. |
Gordon H. Smith, Esquire |
| Consumer Health Law Program |
Maine Medical Association |
| One Weston Court, Level One |
30 Association Drive |
| P.O. Box 2490 |
P. O. Box 190 |
| e_mail: jditre@mainecahc.org |
Manchester, Maine 04351 |
| (Consumers for Affordable Health
Care |
e-mail: gsmith@ctel.net |
| Foundation/Coalition) |
(Thomas D. Hayward, M.D., |
|
Maroulla S. Gleaton, M.D. and the |
| Donald E. Quigley, Esquire |
Maine Medical Association) |
| General Counsel |
|
465 Congress Street, Suite 600
mailto:Mgarvin@Ropesgray.com
mailto:Rgoldma1@maine.rr.com
mailto:bdpmacc@mint.net
mailto:MPA@gwi.net
mailto:gsmith@ctel.net |
Kellie P. Miller, M.S. |
| Portland Maine 04101_3537 |
Executive Director |
| e_mail: quigld@mail.mmc.org |
Maine Osteopathic Association |
| (Maine Medical Center) |
693 Western Avenue |
|
Manchester, Maine 04351 |
| Sandra L. Parker, Esq. |
e-mail: meosteo@mint.net |
| Attorney for MHA, Inc. |
(Maine Osteopathic Association) |
| 150 Capitol Street |
|
| Augusta, Maine 04330 |
Edward Miller |
| e_mail: sparker@themha.org |
Executive Director |
| (MHA, Inc.) |
American Lung Association of Maine |
|
122 State Street |
| James B. Zimpritch, Esquire |
Augusta, Maine 04330 |
| Jeffrey M. White, Esquire |
e-mail: emiller@mainlung.org |
| Catherine R. Connors, Esquire |
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| Pierce Atwood |
mailto:emiller@mainlung.org |
One Monument Square
mailto:meosteo@mint.net
mailto:emiller@mainelung.org
Portland, Maine 04101 |
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| (207) 791_1100 |
|
| (Anthem Insurance Companies, Inc.) |
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____________________________________ |
|
Gordon H. Smith |
|
Attorney for Maine Medical Association |
Last Updated:
March 27, 2012
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