STATE OF MAINE
DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION
BUREAU OF INSURANCE
34 STATE HOUSE STATION
AUGUSTA, MAINE 04333-0034

Now comes Consumers for Affordable Health Care (CAHC), by and through its attorneys, with its second request for information and production of documents on behalf of consumer intervenors pursuant to the Superintendent of Insurance’s Order for Coordination of Discovery. Pursuant to Rule Chapter 350 of the Maine Bureau of Insurance, the consumer intervenors request that the applicants respond to the following requests for documents and information within 14 days. The request and response to it shall be governed by the following definitions and instructions:

Definitions and instructions:

1. "Anthem" means Anthem Insurance Companies, Inc., including each predecessor-in-interest, and its present or former officers, directors, consultants, employees, agents, representatives, counsel, and all persons and entities acting or purporting to act on its behalf or under its control, and each and every subsidiary, affiliate or parent of Anthem Insurance Companies, Inc. wherever located including but not limited to those located in Colorado/Nevada, Connecticut, Kentucky, New Hampshire, and Ohio, unless otherwise noted in the specific request. This definition of "Anthem" shall include Anthem East, Inc. and Anthem Health Plans of Maine.
2. "Applicants" means Anthem and/or BCBSME as defined herein. Unless otherwise stated, a separate response is expected from "Anthem" and from "BCBSME".
3. "BCBSME " means Associated Hospital Service of Maine including each predecessor-in-interest, and its present or former officers, directors, consultants, employees, agents, representatives, counsel, and all persons and entities acting or purporting to act on its behalf or under its control, and each and every subsidiary, affiliate or parent of Associated Hospital Service of Maine unless otherwise noted in the specific request.
4. "Bureau of Insurance" means the Maine Bureau of Insurance.
5. "Document" or "documents" means the original and any copy, regardless of origin or location, or any writing or records of any type or description, including but not limited to the original and any copy of any book, correspondence, pamphlet, periodical, letter, media advisory or release, memorandum, telegram, report, records, study, inter-office or intra-office communication, handwritten or other note, working paper, diary, calendar, application, permit, chart, paper, graph, survey, index, tape, minutes of meeting, notes, agreement, contract, memorandum, diagram, illustration, photograph, telegram, written analysis, report, recording, transcription or memorandum made of any telephone conversation, written communication, office bulletins, notices, instructions, questionnaires, surveys, charts, graphs, papers, books, tape recordings, or other sound or visual reproduction materials, magnetic tapes, or other storage media used in connection with computer and data processing equipment, electronic mail and attachments thereto, world wide web pages and sites, and any other written matter or tangible or physical objects, however produced or reproduced, upon which words, phrases or other alphabetical or numerical characters or information are written, imprinted, or otherwise affixed, or from which words, phrases, or other alphabetical or numerical characters or information, by appropriate transcription methods may be read, produced, printed out, written or otherwise made accessible, any of which are in the possession, custody, or control of the Applicants or their agents, attorneys or employees. It includes the original, any copy with notations, markings or writings thereon, and any drafts thereof.
6. "Governmental agency" or "governmental agencies" means any local, state or federal entity that regulates or has jurisdiction over the operations of the applicants or other carriers, insurers and HMOs.
7. "Insureds" means all certificate holders, contract holders, enrollees, members, policyholders, and subscribers including the dependents of such.
8. "Purchase" or "purchases" or "purchasing" means acquisition, affiliation, consolidation, merger or take-over.
9. "Related to" or "relating to" means constituting, evidencing and/or directly or indirectly mentioning, describing, referring to, pertaining to, being connected with or reflecting upon the stated subject matter.
10. Each and every request for a document or documents to be produced requires production of the document, in its entirety, without abbreviation or expurgation, and without redacting any portions thereof unless accompanied by a claim of privilege or immunity the information for which is provided in accord with definition N.
11. More than one request may ask for the same document. The presence of such duplication is not to be interpreted to narrow or limit the normal interpretation placed upon each individual request. Where a document is requested in more than one request, only one copy of it need be produced.
12. If a request is made for production or identification of documents which are no longer in the possession or subject to the control of the Applicants, state when such documents were most recently in the possession of or subject to the control of the Applicants and what disposition was made of them, including an identification of the person presently in possession or control of such documents. If the documents have been destroyed, identify the person who destroyed the documents, the person who directed that the documents be destroyed, state the reason(s) the documents were destroyed, and the date and manner of their destruction.
13. When a request seeks documents or things from a corporate entity, such corporate entity includes its present and former directors, officers, employees, representatives, agents, consultants, contractors, legal counsel and all persons or entities acting or purporting to act on its behalf or under its control.
14. Whenever the Applicants in a response to any request asserts a privilege, immunity or qualified immunity, please state: (1) the privilege asserted and the basis for asserting the privilege, (2) the name of the person/group originating the document, (3) the date of the document, (4) the name and employment at the time of viewing of each person who has seen the document, and (5) a brief description of the nature of the document.
15. The requests are continuing in nature, and require supplementation by Applicants as documents are located, discovered, generated or prepared.
16. To the extent that any of the documents or information requested herein have been provided in a previous response to questions asked or requests made by any other party, please identify the response or document by the appropriate title, number and subsection, binder and tab, and page number.
17. With each response provided, state the name(s) of all person(s) and/or their employer(s) preparing and/or assisting in the development of the response with the exception of secretarial or administrative staff.

Information and document requests

1. Please provide all documents related to financial projections developed by or for the applicants since July 13, 1999 that take into account changes in and/or anticipated changes in enrollment.
2. Please provide all documents related to AN 02051 (Anthem Pro Forma). Please state in detail Anthem’s assumptions in pro forma (AN 02051) for each of the line items (rows) for each of the calendar years (columns).
3. Please explain in detail the factors Anthem considered that would account for a projected loss of over _____ insureds not counting BCBSME’s ASO lives (over _____ counting BCBSME’s ASO lives) between July 1999 and December 1999?
4. Please provide all documents related to the state employee health insurance contract for calendar year 2000 and beyond. Please provide all documents prepared by or for the applicants related to financial projections regarding this contract. Please describe in detail the total number of insureds that will be covered under that contract, the contract term, the total anticipated premium incurred for the first contract year and all contract provisions that allow for increases during or subsequent to the first contract year.
5. Please provide all documents prepared by or for the applicants related to grand total enrollment figures, with and without the ASO, for each of the months December 1999, January 2000, and February 2000.
6. Please provide all documents related to "rules of thumb" used by the applicants in determining the value of BCBSME. Please include all documents prepared by or for the applicants related to the value of BCBSME on a "per subscriber" or "per insured" basis.
7. Please provide all documents prepared by or for Anthem related to the valuation of BCBS plans purchased in all other states. Please include all valuations and/or fairness opinions prepared by or for Anthem and/or the purchased BCBS plan including but not limited to all valuations and/or fairness opinions made by investment banks and/or valuation firms.
8. Please provide all documents prepared by or for Anthem related to "rules of thumb" used in determining the value of BCBS plans in other states including but not limited to rules of thumb on a "per subscriber" or "per insured" basis.
9. Please provide all documents prepared by or for the applicants related to the marketshare that BCBSME presently has and also the marketshare it anticipates having by the end of calendar year 2000. Please provide all documents prepared on or after January 1999 to the present by or for the applicants related to the value and/or benefit(s) that increased marketshare offers or provides to the applicants. Please explain in detail what value or benefit the increased marketshare offers or provides to the applicants.
10. Please describe on a per subscriber basis the increase in value of BCBSME since signing the Asset Purchase Agreement in July 1999.
11. What percentage of Tufts’ 70,000 insureds in Maine do the applicants project they will obtain by June 30, 2000? If the sale is not approved or the asset purchase agreement terminates prior to closing, what percentage of Tufts’ 70,000 insureds in Maine does BCBSME project it will obtain by June 30, 2000?
12. What percentage of Harvard Pilgrims’ 45,000 insureds in Maine do the applicants project they will obtain by June 30, 2000? If the sale is not approved or the asset purchase agreement terminates prior to closing, what percentage of Harvard Pilgrims’ 45,000 insureds in Maine does BCBSME project it will obtain by June 30, 2000?
13. Did any financial projection and/or valuation prepared by or for the applicants assume liquidation of Tufts’ Maine subsidiary during calendar year 1999? Please provide all documents relating to all such projections and/or valuations.
14. Did any financial projection and/or valuation prepared by or for the applicants assume liquidation of Harvard Pilgrims’ Maine subsidiary during calendar year 2000? Please provide all documents relating to all such projections and/or valuations.
15. Please describe in detail what information was available to the applicants regarding the financial condition of Tufts’ Health Plans of Massachusetts and/or its Maine subsidiary from January 1999 to the present. Please provide all documents prepared by or for the applicants related to the financial condition of Tufts’ Health Plans of Massachusetts and/or its Maine subsidiary.
16. Please describe in detail what information was available to the applicants regarding the financial condition of Harvard Pilgrim Health Care and/or its Maine subsidiary from January 1999 to the present. Please provide all documents prepared by or for the applicants related to the financial condition of Harvard Pilgrim Health Care and/or its Maine subsidiary.
17. Provide the names of all entities which expressed an interest in purchasing and/or providing surplus notes to and/or providing surplus notes with an option to purchase BCBSME from January 1996 to the present. Please provide all documents related to the terms and conditions of each of these separate proposals from January 1996 to the present.
18. Identify each provision in the Asset Purchase Agreement that would increase the total consideration paid by Anthem under circumstances in which BCBSME gains marketshare prior to the closing date beyond that incorporated in the Asset Purchase Agreement. If no provisions were made, why not? How much do the applicants anticipate the value of BCBSME will increase between July 1999 and July 2000?
19. What share of Maine’s private health insurance market do the applicants anticipate having by December 31, 2001? By December 31, 2002? Please provide the calculations underlying these projections.
20. Please provide all documents related to all changes to the Asset Purchase Agreement agreed to by the applicants since July 13, 1999.
21. Please describe in detail BCBSME’s decisionmaking process that may or will lower the purchase price by increasing BCBSME ‘s liability for Medicare claims under the Asset Purchase Agreement. Provide all documents prepared by or for BCBSME related to the decision. Please state the expected amount of those liabilities and provide all documents estimating the costs of those potential liabilities.
22. Please provide all documents related to BCBSME’s possible conversion to a domestic for-profit stock insurer with or without making an initial public offering (IPO)? Please provide all documents prepared by or for BCBSME related to all valuations of BCBSME as a domestic for-profit stock insurer with and without making an initial public offering (IPO). If BCBSME did not consider converting to a domestic for-profit stock insurer with and/or without making an initial public offering, state why not.
23. Please provide a detailed explanation of all the methods and/or types of valuations that were proposed and/or considered by the applicants? Describe why each method and/or type of valuation was accepted or rejected as a method for valuation. If any other valuation was performed, please provide all documents related to it.
24. Please provide all documents related to interest by any other BCBS plan in purchasing BCBSME in whole or in part since July 1999.
25. Please provide all documents related to interest by any carrier, HMO, or insurer as defined by Maine law in purchasing BCBSME in whole or in part since January 1998.
26. Please provide all documents related to all investments made by BCBSME from January 1997 to the present. Please describe in detail the monetary value of those investments and the interest or earnings on those investments in each calendar year from January 1997 to the present.
27. Please describe in detail the enrollment efforts made by the applicants in Maine from January 1999 to the present. Provide all documents related to the applicants enrollment efforts in Maine for that time period.
28. Please describe in detail the distinctions that Anthem makes between "medical director support", "medical policy", "medical decisionmaking", "medical care management." Which, if any, of these will be performed in Maine by currently employed BCBSME employees? Please provide a chart which describes the positions responsible for each of these items and where (by state) these positions are located.
29. Regarding AN 03052 – AN 03058, please describe in detail how long it took to resolve the complaint(s) from the first notice of complaint received by Anthem and the ultimate resolution of the complaint, the personnel involved in resolving such complaint(s) and in which state(s) they are/were based, any payment standard applied in resolution of the complaint(s), and the reason for the length of time taken to resolve such complaint(s).
30. During the public hearings, Robert Gibbons, executive director for the Maine Education Association Benefits Trust, stated six (6) conditions that the association wants placed on the purchase. Please provide response by the applicants to each of the six conditions. Mr. Gibbons also stated that the applicants will include certain of the conditions he mentioned in their upcoming contract renewal. Please describe in detail which of the six conditions will be incorporated into the contract and the reasons for such incorporation.
31. Please describe in detail Anthem’s policy rider which delays access to FDA approved prescription drugs for six months and the decisionmaking process used to apply or waive it. Please state in your response who made the decision to impose this rider and where (by state) the such decision was made. Please also include in your response what level of personnel has authority to waive application of the rider and under what circumstances.
32. Please describe in detail the method Anthem used in collecting and/or providing information regarding prior authorization denials in Connecticut for the November 1998 report issued by the Connecticut Department of Insurance. Please include in your response how Anthem’s methods may have resulted in a higher level of denials than other carriers or HMOs.
33. During the public hearings, James Parker, chief of public affairs for Anthem, stated that "All health care is local." Yet, he proceeded to describe a limited number of areas in which health care, especially health care decisionmaking, would remain local. Please state in detail which aspects of health care will not be local or under local control post-acquisition.
34. Provide all documents related to utilization review criteria used by Anthem that will differ from BCBSME’s current utilization review criteria by product.
35. Please describe in detail the changes in utilization review criteria that Anthem has imposed subsequent to each BCBS plan from January 1995 to the present. Provide all documents related to changes to utilization review criteria in each state where Anthem purchased a BCBS plan from January 1995 to the present.
36. Please describe in detail BCBSME’s subsidies for insured’s premiums, copayments, coinsurance, or deductibles past or present. Please state in detail eligibility criteria for such subsidies.
37. Please describe how Anthem will outline and/or inform its subscribers about reproductive health services. Please include in your response all reproductive health services Anthem will cover.
38. Will Anthem contract with family planning programs for all the services each program currently provides including but not limited to colposcopy and endometrial biopses? Please provide the rationale for your response.
39. Will Anthem contract with nurse practitioners in Maine?
40. Will Anthem allow its insureds in Maine to self-refer to reproductive health providers (including but not lmited to nurse practitioners) beyond the state-mandated statute of one annual visit a year? Please provide the rationale for your response.
41. Please describe in detail what the term "IBNR" includes as used by BCBSME.
42. Please describe in detail the procedures that are currently utilized by Anthem to ensure confidentiality of insureds’ records and to ensure that access to insureds’ records is restricted. Please include in your response the names of all companies, including but not limited to pharmaceutical, brokerage and telemarketing firms, with whom Anthem shares any insured information on a confidential, redacted or non-confidential basis.
43. Please describe in detail the procedures that the applicants’ will use to ensure confidentiality of insureds’ records and to ensure that access to insureds’ records is restricted? Please state whether Anthem anticipates making insureds’ records available to any entity on any basis. If yes, please describe in detail what information, the uses for which it would be made available, and the bases upon which it would be provided.

Clarification of Consumer Intervenors’ First Discovery Request Questions:

13. Please provide a chart that describes in detail all Anthem purchases of BCBS plans anywhere in the United States from 1993 to date and provide a schedule of premiums for each and every product offered by the seller during the 24 month period prior to the sale date of closing and by Anthem in the 24 month period subsequent to the sale date of closing. In states where Anthem has less than one year of premium experience, such as New Hampshire and Colorado/Nevada, please state the premiums currently in place and the premiums that Anthem has sought or will seek in the next six months for each and every product offered.
14. For each purchase identified in response to question number 13, please provide a chart that describes in detail each and every: a) product added and/or dropped; b) increase or decrease in coinsurance rates and/or copayment amounts by item or service and by product; c) increase or decrease in lifetime and/or annual benefit amounts or payments by product; and d) increase or decrease in benefits and/or coverage levels by item or service and by product, for the first 24 months after the purchase date of closing. In states where Anthem has less than one year of experience, such as New Hampshire and Colorado/Nevada, please provide the above information as it is currently in effect and any proposed modifications Anthem has sought or will seek in the next six months for each and every product offered.

Respectfully submitted,

 

Joseph P. Ditre, Esq.

Dale Lavi, Esq.

Consumer Health Law Program

Patrick Ende, Esq.

Maine Equal Justice Partners