Randi Weingarten expresses concerns about GHI-HIP merger to State Insurance Department

Apr 14, 2008 4:23 PM

February 29, 2008

Hon. Eric R. Dinallo
Superintendent of Insurance
New York State Department of Insurance
25 Beaver Street
New York , NY 10004

RE: Proposed Conversion of Emblem Health (HIP- GHI) to For-Profit Status

Dear Superintendent Dinallo:

I write on behalf of the members of the Municipal Labor Committee comprised of over 300,000 public employees, the largest component of the membership of HIP-GHI, which, as a combined entity, Emblem Health, seeks to convert to For-Profit status. We respectfully request that action on the application be deferred pending the critical issues described below.

Enclosed is a copy of my February 8, 2008, letter to Mayor Bloomberg, which is copied to Anthony L. Watson and Frank Branchini, respectively CEOs of HIP and GHI. To date, our concerns have not been responded to or addressed.

As I noted in my February 8 letter, our initial concern remains that if the state, through your agency, approves conversion, both New York City and its unions must share in the proceeds since it was their assets and business that made possible the current financial viability of HIP-GHI. Any approval, therefore, must make provision therefore.

Additionally, rumors persist that upon conversion there will be a “flip” of both the management and control of the converted entity. That is unacceptable. At a minimum, a multi-year “freeze” must be imposed as a condition to the grant of any approval.

The fundamental concerns must be addressed prior to approval; otherwise we may well be required to consider alternatives.

We continue to remain open to constructive dialogue. Since none has occurred to date and action by the Department will make constructive dialogue difficult if not impossible, we strongly urge you to defer any action on the application at this time.

Very truly yours,

Randi Weingarten

Cc: Anthony Watson
Ed Skyler
Jim Hanley
Frank Branchini
MLC Steering Committee