3$J A2ndS/r-t,IW1f N<>wYo.t M'f0036 (� 1J6-:Jf)1QI Fo,: (212) 736-8396 . ··: ....-. ·:�-:>·.!?"'.. ' . , ·: C4 ro:728 • ' • I AA'J}Wf.o«�/�li'� 0., 212W6$1'�.s:n=t � I.<Sru«> . ' . , ' � : . ' (JfZJ.U9-fi.J 1 I Fe,: 649--f52'T(312) K>30$fro<>( ct-'nuf � fl<\ 1Vf(lJ VIDEO MONft'ORING £21$/569-4990 I Fax:.56:J..1985 (2t5J SERVICES m lbrtsonStroot San NO'lCkoo C494101 OFAMEAICA., INO. (418/ 6#..J.Jd1 I50<,WJ R;,,c{41S} A /l!!!L�Alflllatg Tl?M'SCRIPT May ·1s, 1,994 7:.00:--�-:00 PM (ET) <IBS.-TV .· 6.0 M;i.nutes Lesley · Stahl reporting: With the Clinton health plan ust beginning its stretch run.and congress still deba ing the best way to provide �very American wtth 1ow-cos-, guaranteed.-for-1ife heal'th. ip.surance, we thought it� god time to take a look at the health insurance plan o e out of four �ricans relies on right now. We' e talking,.of course, about the s�y-nine independent ,. n t-for-profit hea1th insurance·companies that go under e name Blue Cross/ U1ue Shie1d-- �lthough you couid ge an argument about . "not �or p�ofit," and, as you'll se , we did. Wha� there is no argument abo tis that Blue crosstBlue Shield, next to coca Col. , is the most widely reco¢zed tpaµemark in Alllerica. erybody knows them • . (�olds µp her own Blue cross card) . And if you're one of sixty-eight -million Alllertcans like e who carries a Blue ·c;r.oss or niue Shield card and depen son it to help pay your medical bills,. then you'll pro ably be as surpris�d as I was to learn that many of the lans are facing charges· of lllis�age1I1ent and charge of ertravagant - .spendi�g--pa�d for PY the subscr;b Sel)ator Sam Nunn heads the Pe ane�t Subcommittee on- Investigations. He's been probi g Blue Cross/Blue .Shiel� .f<;r.r the l.ast two years. :S�th .-Sam Nunn (0-Geo:rgia): They ge • all of these tax breaks�. and they can pass on their. osses and their misma�agein�t- an� their excessive s iaries and their pex-ks to-� po1�cyho1ders• . S.tahl.:. What -kind of per,k;:1-? Well, n Macy1and, Blue Cross/Slue Shield executives spent­ ee hundred thousand d,o·l.l.ar.s. for a sky box at the Oriole stadium, plus hu�dreds �f season tickets at eight �o ten thousand dollars each. Ma/criol NP()(ic<1 bY. V-deo Montrr:xlna ScMOC1 of Nrl<HkxI.Inc.maybo uux:J forlntomol wvww. aoolysis t=rdi only. Any odllffl(J.roproducllan. publication. ro- bt'oodoo•l;na.J,o<,,M>O pub(:C or public dl,play foroldd<>n I• and may-..olol<> copyrio'11 law. � vki<><,lo1x; oflfti4 �I i4ovoi/ook' inony format for a porlod Io( 3 day< homair dato, audiooaucllo< f,(day,. Cell011y vM5off,=. 15 age 2 of 8 B.ernard Tresnowski- (Blue cross/Blue Shield Association): Tµere.may � questionable business udgment involved here -in.some of these decisions, but one has to understand that yo�'re operating in a competit ve environment. Stah1! Bernard Tresnowski heads th national,Blue. Shield Association, a tr de sroup that is Crossiaiuesupposed t9 . act as a watchdog over e sixty-nine d-i:tferent plans. · .(T.o Tresnowski) What does ha ing a sky box at the basebal-1 -stadiwn have to do with th competitive business onvi-ronment? �eShQWS��! We11, maybe most of O competitors have sky -boxes a�d th,,ey take customers there . ·.. Stah.-1;· · ��ll, sp wh�t? :-.·. ·-�e��w:sk1.: Wel.l, you operate in a compe tit�:ve environ­ .·:·. :_i.,�-- �ot j-us�ifying th e sky ;t?<»c, bel e.ve me� :·.. ..$.tah.1 -: · ··'ffhy, s.h�ld you o.are about a 1?ky �x.? Be�use if you.<·re. a. ·J?.l.ue cross/Blue ·shield sub cri..l:;,er, you r re paying i:t witµ.jiour_premiums, and yout: e paying tor the f�rLimos, .. the .<;>;-th.er perks, and the big salaries. And that · isn't ·a'il. Many· qf th� plans-·are under vestigation for-fraud a�- The biggest plan r New Y rk's Empire, is a�u�da�u�e. �f k�eping two separate set of books. Blue · �o.ss. e�ecuti:ves in Mi;;sissippi and Marylanq were - ... -i�icited.--:fo,; ·fraud. -.Nunn:· · .And.that's one. of the reason health care premiums ·and ��e��ea1�h care costs are iea ly out of. control. Stahl·: • �any of th� pl�ns. have been mismanaged. In New York,•· .the tpp ex�cutive.s were force to resign. In : eo:l:�ado.; ·the chief e�ecµtive quit. fter there were audit . : .... · _ir�egul:a.r.ities • · • · (.� �unn) F.J-orida--they had o pay the federal .g�vernment ten mi1�ion dollars to s ttle Medicare fraud • cl:a-im.s:... .,West Virginia--the whole s stem beoame · · • : I :il'l:so'.l'v:ent_ Maryland--executives we e jetting to the : O:l:ymp:i�s,. �� 01ympics on inon�y fr. the non-profit•••• Nunn:·· -i -�l.-ieve they sent sixty7fo r peopl.e to the .<?',!tyiupi:�s. l �88 Olyiµ.p,ics_. e Concord. 16 .. Page 3 Of 8 -3- N\lnn� You cannot 1et people be out there in this never,-never land a-nd claim they' re on-profit but pay their officers seven, e�ght hundred thousand dollars a y_e.ar., take. trips all over the world on CQncord, have. sky boxes .that cost hundreds of thousan s of dollars a year. [From Ttr commercial: ytiice: <>·f. Jack Burry: smart busines es spend their health oara doil.la-r-s very eff ici.ently. At lue Cross and Blue Shia.l.d .o f Ohio, for every dollar yo company pays, a penny get& saved for a rainy day.) · Stahl": �d � couple of pennies pro ably go to help pay Jae� �urry's salary. He's the mill on-dollar-a-year .-chief. of Blue Cross/Blue Shield ·of hio featured in this .Ad. ·The �ot-for-profit Ohio plans ent .another million . :dol-i.ai;� t9 build a luxury :box at th Gleveland Indians -new .baseb�it s�adium, and another o e ·at th� cavaliers . new-.. basketba-11 arena. .... Ja�k- Burry decli.n!-:?d our 17egue an i�terv-iew, "®t. ��-�n9wsk.i had this. t!J say • .. Tres�ow?��: Noy, wait a �inute. · N w, we don't control we don't control the usiness practices. ·:t:1:teThe.-=Cl-eveland salarl��,, plan is a strong plan .financially. If the boa�d;o;f that pla� and the regulato sin that state feel .that �ai; e;:orpoiration ha? performed at the level that it is · a� ·th(;ly want to pay the individ al tQqse kinds of � -s�lar�es, it'� up to th.at corporati n and those regul:at0_1;s•· S·1:ahl:. •But-what a�ut your .image? What abou:t what that · :3:,ogo'. �ays·? .-�:z;esnow'sld:� The logo doe-s�' t say t w� ·pay our · .�;xeGu.t-i-ve� ,!-:na.dequat� salaries. S.t.ah:l':· But -B.ob Hunter, who was the head of a national insw;-an�� consumer group. and is no� the insurance ·c�mmis�ioner of Texas, thinks Blue oss/.Biue Shield pays -t;:hei·r'..:,e-���t;;;�yes too ID,Qch money • . •(.To.l{u-nter) Would you be get ing a decent guy to �.a.big qoropany if you don't pay im �at kind of ·. -�nay? . · ' . • '.j_.,- R<;>bert. Hunter (Texas -Com.mission of I�surance): Oh, . s�r�· ·}'OU .:c�n � For o�e. thing' becau e we're sure there's . -no'/real, bo�·�-d 9f directors, ·there's no stoci<ho.lde.r . di's.9ip.1•in.e., y.ou don't have the same kind of need for ·.th�· .h�gh·,.sa,l:ari�s, p lU:s you've got e non-profit. 17 Page 4 Of 8 -4- Nunn : There's something wrong here It's a .business, they're being paid like businesses, the executives are being compensated like businesses, nd yet they call themselves non-pro�its. Stahl,: Most 9-f the large heal.th in companies are · for profit. Th�� means they pay di id�ds to their shax:eholq.ers., who , if they don 't. l e the way the company is . i;tin, �n :f-ire the executives.. B t BLue Cross/B1ue -Shield plans are not for profit. T at means their profits get plo�ed back into a pool to pay subscribers' ·c:: 1ailn&• . Runh-:. When you're in business, you ought to be for .p;cofit.. �ou -ought -t;o have sharehol ers , you ought to .. ·. })ave- -acco_untability with shareholda s, you · ought to show • ��e: ..bqt,f;ow. line, _and you ought to b a busin�s. -S.tahi: some plan executives agree . ith Senator Nunn , but a ·conf·idential internal Association tnelll.O warns that if th�Y -�id .bec.ome- a fo�-pro�it busine s, they would pay . high�r -,t;ax�s-. (Visual: of high1ight d words and the memo .as .backgr.ou_nd) ·. ·_. : (To. T�e.snowski) .:r thought . th t Blue Cross got �pe�iai tax b�e*� - ·I� that true? �esnqws�i: -No , it'� not • . Stahl:: :y�u. get no tax b��ak.s.