Frequently Asked Questions: Employer Groups

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What is happening?
After careful consideration and using our Health System’s long-term strategic direction as a guide, the University of Michigan has sold M-CARE to Blue Cross Blue Shield of Michigan. This is a mission-focused decision.

Technically, M-CARE and its subsidiary, M-CAID, was sold to Blue Care Network, a subsidiary of Blue Cross Blue Shield of Michigan. M-CARE’s subsidiary, Michigan Health Insurance Corp., was sold to Blue Cross Blue Shield of Michigan.

When was the sale final?
Dec. 31, 2006.

Why did you sell M-CARE?
The current climate for the health plan industry has changed from even a year or two ago. One major change is the development and implementation of consumer-driven health care plans; another is emerging technology that may require significant capital investments. As a result, the Health System and many other plan owners are pursuing opportunities they may not have considered in the past.

Under the expert leadership of CEO Zelda Geyer-Sylvia, our M-CARE team has made M-CARE an exceptionally high-quality, well-regarded, and valuable health plan that made it attractive to BCBSM.

Why did you sell to BCBSM?
* We are both non-profit organizations and share the mission of improving the health of Michigan’s citizens.  
* We both are committed to improving the quality of health care and streamlining health care administrative processes.
* Both organizations are committed to a seamless transition.  Aligning with a local company will make it easy for members to transition their health care coverage, since the Blues provider network includes nearly every M-CARE provider.

We also entered into a joint venture to improve health care delivery and public health in our state. BCBSM's long-standing cooperation with our health-services researchers has resulted in a number of successes in the improvement of the health status of our citizens. Part of the appeal of this opportunity is an expansion of this health services work together.

Do you have examples of success in this previous relationship?
Yes, for example, BCBSM and U-M have worked together to improve treatment of patients receiving cardiac catheterization and angioplasty at hospitals across the state through the BCBSM Cardiovascular Consortium, which has saved both lives and dollars by leading dozens of hospitals in improving their care (more info). Recently, BCBSM and UMHS have embarked on several other quality-improvement projects that will involve many Michigan hospitals to improve breast cancer care and several types of surgical care.

With the UMHS budget picture looking so healthy, why now?
Pursuing this change now helps ensure we can continue our critical missions of educating tomorrow’s physicians, conducting groundbreaking research and providing exceptional care to patients in Michigan and beyond.

Does this mean that U-M might consider transferring other parts of its patient care mission (such as hospitals, clinics or the Faculty Group Practice) to private management?
No. The Health System is strong because its hospitals, clinics, doctors, nurses and other key elements of good health care delivery are all part of the University and under the same "umbrella."

As for the Faculty Group Practice in particular, we are in the process of integrating it with Ambulatory Care so that we operate more seamlessly as an institution.

What will happen to the MHealthy Focus on Diabetes project? Doesn't that rely on M-CARE for administration?
We are committed to ensuring the program – which waives or reduces co-pays of diabetes drugs for participants -- continues through the two-year pilot phase as long as the results are positive. Future continuation of the program after the pilot ends in June 2008 has always been contingent on its effectiveness. 

Is the transaction a “good thing” in terms of streamlining paperwork and reducing administrative costs for providers and employers?
Our goal is that this transaction will reduce administrative costs and improve efficiency.