Ohio Blue Policyholders Approve Proposed Deal
May 03, 2011
CLEVELAND -- Columbia/HCA Healthcare Corp.'s $299.5 million bid to acquire most of Blue Cross & Blue Shield of Ohio passed another hurdle as Ohio Blue's policyholders approved the proposed deal. Obtaining policyholder approval allows Ohio Blue to continue pursuing the deal, in which Columbia/HCA, in Nashville, Tenn., would acquire 85% of the not-for-profit insurer and its reserves and gain entry into the health-insurance business. The proposed transaction still faces further regulatory hurdles, including review by the state Department of Insurance and a public hearing, expected to be held in the fall. Nevertheless, Kermit W. Bankston, Ohio Blue's president, said the company believes it can complete the transaction ``by the end of the year.'' Ohio Blue said the preliminary results showed 29,743 votes in favor of the deal, including 19,858 general proxies that Ohio Blue voted. The company said 6,903 votes were against the deal. Natasha Barragan, an official at consumer-advocacy group FamiliesUSA, called the vote ``premature,'' adding that materials sent to policyholders were ``incomplete.'' ``We think the policyholder vote should be disregarded,'' Ms. Barragan said. FamiliesUSA and lobbying group Consumers Union oppose the deal, insisting, among other matters, that it would deprive policyholders of their rightful stake in Ohio Blue's cash reserves and prevent Ohio Blue from fulfilling its ``charitable obligations,'' such as endowing foundations, Ms. Barragan said. The groups also believe that the proposed deal undervalues the Ohio Blue assets. Ohio Blue covers 1.5 million Ohio residents and generates about $2 billion in premiums annually.
VastPress 2011 Vastopolis
