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Blues to Alter Small-Firm Rates 20090803-NEWS--0001-NAT-CCI-CD_-- 7/31/2009 5:37 PM Page 1 ® www.crainsdetroit.com Vol. 25, No. 30 AUGUST 3 – 9, 2009 $2 a copy; $59 a year ©Entire contents copyright 2009 by Crain Communications Inc. All rights reserved Page 3 Blues to alter small-firm rates would be Higher claims may mean higher premiums charged higher rates under the BY JAY GREENE pricing system, several health ben- director with Troy-based McGraw new program CRAIN’S DETROIT BUSINESS efit experts said companies with Wentworth, said another option she than would be Oshkosh’s M-ATV contract employees who have chronic con- will suggest to her clients is to self- charged lower win changes the playing field Blue Cross Blue Shield of Michigan ditions or high claims will face insure their health benefits. rates. has received state approval to be- tough choices at policy renewal “Groups with higher claim expe- “Blue Cross gin on Oct. 1 charging small-busi- time. rience would have some rate im- wants to set the John Bailey & Associates ness customers that have 51 to 99 The small groups either will pay pacts and groups with lower rates more ap- employees group insurance premi- higher premiums, go shopping for claims experience would have low- McLaughlan propriately,” sells to Grand Rapids firm ums based on factors that include a lower-cost policy with another er rates,” McLaughlan said. McLaughlan their health claims experience. insurer, choose a health mainte- However, McLaughlan said be- said. “They have lost money in While Blue Cross officials said nance organization or cancel their cause Blue Cross insures groups that segment of their business.” Inside customers asked the nonprofit health insurance. with sicker and costlier work- health insurer to develop the new Rebecca McLaughlan, managing forces, she believes more groups See Blues, Page 21 Detroit retirement department’s plan to build on riverfront draws fire, Page 4 DPS breathes Council of CEOs meets life into idle to advance East-West cooperation, The Greektown turnaround team foundation; Page 6 from The Fine Point Group (left to right): CEO This Just In Randall Fine; donors ready Amanda Totaro, Residential Home Health senior vice president, brand buys Illinois care agency marketing; and Last step: Hire Chris Colwell, Residential Home Health, a senior vice Madison Heights-based president, CEO to operate home health company, has gaming acquired Edward Home Care, a operations. BY RYAN BEENE home health agency owned NATHAN SKID/CRAIN’S DETROIT BUSINESS by Edward Hospital in CRAIN’S DETROIT BUSINESS Naperville, Ill., for an undis- Work is under way at the Detroit closed amount. Public Schools to transform the De- The purchase is part of a troit Public Schools Foundation, a new strategic growth plan Greektown bets on ‘value’ 501(c)(3) nonprofit that has sat for Residential, said David idle since its 2003 formation, into Curtis, its president. a university-style endowment and “This Edward transaction Market share rises with focused marketing development office for the dis- is a model for us. We are ac- trict. tively looking for other simi- The foundation would manage BY DANIEL DUGGAN MacKenzie & Dunleavy, the casi- lar agencies owned by hospi- an endowment funded by money CRAIN’S DETROIT BUSINESS no’s lead restructuring adviser. tals in Michigan and the GROWING MARKET SHARE raised from alumni, corporate, in- Midwest,” said Curtis. One month after entering Greektown Casino has taken a stitutional and individual donors By acquiring Edward bankruptcy protection, Greek- growing share of the casino Finding a niche to pay for such Home Care, Curtis said Resi- market in Detroit this year: efforts as dis- town Casino Hotel finished June Fine Point CEO Randall Fine dential beat 14 other compa- trict athletics, 2008 with revenue down 18 per- GreektownMotorCity MGM Grand said the strategy has four points: nies, including such in- fine arts or cent from June 2007 and captured branding, leadership with em- vestor-owned companies as Jan 22.8% 34.4% 42.8% specific non- an all-time low 21.1 percent of the ployees, a focus on public rela- Nashville-based HCA Inc. Ed- recurring pro- gaming market share in Detroit. Mar 25.0% 34.7% 40.3% tions and use of an advanced ward Home Care has 40 em- jects, such as One year later, the casino con- database marketing program. ployees and 150 patients, he Jun 26.4% 33.7% 40.0% providing elec- tinues to operate in bankruptcy Branding the property meant said. tronic black- but has shown a 24 percent in- Source: Michigan Gaming Control Board establishing a niche, he said, Edward Hospital will re- boards for crease in revenue over June 2008 honing in on the idea of a “value tain a minority stake in Resi- every class- and market share that has in- than one-third of the gaming mar- proposition” for people to have room in the Bobb creased to 26.4 percent. ket and has restructuring costs fun at a reasonable price. See This Just In, Page 2 district, DPS’ emergency finan- While the casino still has less eating up most of its profit, the lat- “The message in the past was cial manager, Robert Bobb, told est chapter of the Greektown tale ‘we’re a nice place too,’ or ‘we Crain’s. is becoming a turnaround story. have nice restaurants too,’ ” Additional funding would be Behind the numbers has been Fine said. “You know what? The crucial for the district, which an aggressive marketing and nicest casino in Detroit is one faces a $259 million budget deficit repositioning process led by the mile away, it’s not this one. and shrinking state funding. Las Vegas-based casino consult- We’re not going to try to compete “Many public schools don’t ing firm The Fine Point Group, on MGM’s playing field. A value function as if they’re a university, which took over in January after for regular folks is what we’re so in essence we’re a public it was hired by Birmingham- going after.” NEWSPAPER based turnaround firm Conway, See Greektown, Page 20 See Foundation, Page 20 20090803-NEWS--0002-NAT-CCI-CD_-- 7/31/2009 5:13 PM Page 1 Page 2 CRAIN’S DETROIT BUSINESS August 3, 2009 about 10 percent of Soave’s over- al SBT taxes and interest under Office supply firms form co-op Taubman Centers Inc. in February THIS JUST IN all beer volume moving about 2.2 protest and filed a lawsuit. to form Julie Fielder Retail Consult- million cases per year supplying Treasury filed an appeal after A group of independently ing Services L.L.C. ■ From Page 1 AB InBev products to Kalama- the Court of Claims found the owned office supply companies In the one-year Birmingham zoo, Branch, St. Joseph and parts firm was entitled to full restitu- that serve metro Detroit have cre- contract, she will be seeking new dential’s Illinois operations. of Allegan and Van Buren coun- tion, and the firm filed its own ap- ated a co-op to encourage local retailers to add to the mix of busi- buying by office managers. Residential, which employs 450 ties. peal since the lower court did not nesses in the shopping district. The co-op, Independent Dealer workers in Michigan, plans to Both Kalamazoo Beer Distrib- address interest, costs or fees “I’ll be showcasing Birming- Marketing Group, created the Web hire another 100 workers in uting and West Side Beer are ex- owed since the 2005 audit. The ap- ham to the national retail com- site www.littleguyssupplies.com. Michigan and Chicago over the clusive Anheuser-Busch InBev peals court Friday sided with the The site offers online ordering of munity,” she said. “We want to next several months, said Mike distributors. firm and ordered the case re- more than 40,000 items and touts bring well-capitalized retailers to Lewis, its chairman and CEO. — Nathan Skid turned to the lower court to com- free next-day delivery as well. augment what’s there today.” Residential has licenses to op- pute interest on top of Honig- “The inspiration for Little — Daniel Duggan erate in 34 Michigan counties and man’s refund. State appeals court sides with Guys Supplies was to let busy of- serves about 10,000 home health — Chad Halcom fice managers know that there patients, said Joe Mooney, its exec- Crain’s adds to marketing staff Honigman over Treasury are genuine, local alternatives to utive vice president of sales and Detroit-based Honigman Miller the national office supply retail- Kim Winkler has been named marketing. Metaldyne pension goes to PBGC Schwartz and Cohn L.L.P. learned ers,” said Greg Newton, executive marketing coordinator for — Jay Greene The pension plan covering Friday it will receive a judgment director of the Independent Deal- Crain’s Detroit Business. 10,770 employees of bankrupt of interest on top of a $114,628 re- er Marketing Group. Winkler, 24, has a bachelor’s auto supplier Metaldyne Corp. has Soave sells beer distributor fund the law firm is owed on the Independent Dealer Marketing degree in organizational commu- been taken over by the federal state’s former Single Business Group consists of Westland-based nication from Detroit-based Soave Enterprises government, the Pension Benefit Tax, following an unsuccessful Office Star L.L.C., Madison Western Michi- Inc. has agreed to sell one of its Guaranty Corp. announced Friday. appeal by the Michigan Department Heights’ LB Office Suppliers Inc., gan University distributors, Kalamazoo Beer Dis- of Treasury. The Plymouth-based company, Port Huron’s Kerr-Albert Office Sup- and a minor in tributing, to Grand Rapids-based which reported revenue of $1.57 ply Inc.
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