Premera receives federal tax windfall, commits to investing in rural health
What to do with millions of dollars in refunds: That's the question in front of Premera Blue Cross, which is receiving $390 million in tax refunds because of recent changes to federal tax law.
Premera faces no restrictions on how it can use the windfall of money.
The Mountlake Terrace-based agency will put some of it toward raises, by way of a $1,500 bonus to each employee.
The bulk of the refund, however, will go toward bringing doctors and health coverage to rural residents. Premera has committed to offering individual health plans in any county where there's not another insurer in 2019. That’s something rural counties, including Grays Harbor and Klickitat, have struggled with.
Premera spokesperson Steve Kipp said it's a risk for them.
"We obviously don't know how many counties would be in that situation, so we don't know what the total cost would be to the company, but we feel it matches with our mission," Kipp said. "We're about trying to provide people access to care."
Washington Insurance Commissioner Mike Kreidler said ensuring every county has coverage will help stabilize the health insurance market.
"It gives me a great deal of comfort going into the rates and filings that we're going to get from the health insurers for 2019," Kreidler said.
His office has focused on building up the insurance marketplace, despite changes at the federal level meant to unravel the Affordable Care Act.
Kreidler said Premera is the only Washington insurer eligible for the tax windfall, but he’s hoping more companies are willing to cover rural counties in 2019 and beyond.
Premera will use some of the tax refund on initiatives to recruit more doctors and telemedicine to rural towns. The company has also committed to offering insurance plans in 2019 in Alaska, where it’s already the sole insurer on the individual market.
All of those initiatives combined will cost about $250 million. The insurance agency has not announced whether it will invest the remaining $140 million in the community or internally.
Note: Premera Blue Cross is an underwriter of KUOW.