New Pennsylvania Senior Health Insurance Program Created
Nov. 13, 2008 – Pennsylvania officials today unveiled a move designed to keep the state health insurance program for seniors afloat after parent company Conseco .
The entity formerly named Conseco Senior Health Insurance Company has been detached from parent company Conseco as of today and renamed the Senior Health Insurance Company of Pennsylvania (SHIP) with program oversight provided by a prominent board of trustees that includes a former U.S. surgeon general.
The separation of the two entities means the state senior health insurance program’s long-term care business will be managed by state health insurance officials who will be subject to oversight by the newly created Pennsylvania Senior Health Care Oversight Trust as well as the state Insurance Department.
The independent board of trustees composed of former state insurance regulators and financial experts includes former U.S. Surgeon General Dr. C. Everett Koop, who is an authority on health care issues affecting senior citizens. The oversight trust will manage the state senior health insurance program as a non-profit organization whose primary purpose is to satisfy the obligations of the health insurance coverages underwritten through the program.
In addition to Dr. Koop, the board of trustees includes lead trustee and former Massachusetts Insurance Commissioner Julianne M. Bowler.
“We view the establishment of Senior Health Care Oversight Trust as a novel and innovative means of helping to maintain the entire focus of SHIP on protecting the interests of policyholders. The entire board will single-mindedly pursue that important objective,” Bowler said.Trust membership also includes former New York State Insurance Superintendent Gregory V. Serio, former Mutual of Omaha and chief actuary and president of the Society of Actuaries Cecil D. Bykerk, and John W. Wells, president and chief executive officer of the state’s senior health insurance program.
“This unique structure aligns the interests of the Trust, management and regulators with those of SHIP’s 140,000 long-term care policyholders,” Wells said. “SHIP is being operated for the benefit of Conseco’s former long-term care policyholders and without a profit motive, so as to ensure that any future benefits from rate increases or policy changes will accrue solely to policyholders.”
Wells also will serve as the president and chief executive officer of the Pennsylvania health insurance program after having served as an executive at Conseco.
In light of recent company losses and with an eye toward maintaining the state senior health insurance program, Conseco officials in August said they would create an independent trust that would own and operate the company’s struggling state program for seniors. Under the terms of the completed transaction, all of the stock of the former Conseco firm has been transferred to the trust, including $121 million of total adjusted capital as of September 30, to which Conseco officials recently added another $175 million.