INSURER ASKS FOR JUDGMENT IN DISPUTE WITH STATE

Blue Cross and Blue Shield of Missouri filed a motion for a summary judgment this week in its lawsuit against the Missouri Department of Insurance.

The health insurance provider is suing the state agency in a dispute over the state's claim that up to $500 million of the company's assets must be turned over to the state or a designated charity because the company improperly established a for-profit business, the RightChoice managed care product, in 1994.

The original suit was filed May 13. On May 21, Cole County Circuit Judge Thomas Brown issued a temporary restraining order barring the state from taking further action against the company.

Jim Floyd, a spokesman for Blue Cross Blue Shield, said the company is asking Brown to rule directly on the suit, without it going to trial.

The company is arguing that Department of Insurance Director Jay Angoff was kept fully informed of the nature of the company's reorganization, and approved the reorganization without comment.

"We're saying that there's no argument about the facts of the suit," he said. "We want the judge to rule on it based on the law."

Department of Insurance officials could not be reached for comment Wednesday.

The motion filed this week asks the court to "end this overbearing attempt to pressure Blue Cross into giving away its subscribers' money," and says the court "should squarely reject the Director's's and the DOI's improper and coercive attempts" to obtain the company's assets.

Department of Insurance officials, backed by several public interest groups, assert that the company must forfeit its premium assets because, as a not-for-profit organization, Blue Cross was exempt from Missouri's premium tax.

Blue Cross officials argue, though, that under the company's not-for-profit charter, it was agreed that programs to provide insurance coverage to poor and underinsured families would be established in lieu of the payment of premium taxes.

Company officials also argue that the company was chartered for the benefit of its members, not the public, and the public is not entitled to its assets.