Loch Ness monster
When I launched this campaign in March, I posted a petition at change.org calling on Blue Shield to convert to a for-profit company, which would trigger a requirement that its approximately $10 billion in assets be relinquished to a public benefit foundation. Given that Blue Shield has long behaved like a for-profit company, that seems like a logical way to harness Blue Shield’s nonprofit assets for community benefit.
I’ve decided, however, to reframe the petition slightly. The petition now calls on Blue Shield to convert to for-profit status and transfer its assets to the public or start acting like a real nonprofit.
What would a real nonprofit do? Consider that if Blue Shield converted, the public benefit foundation established with its assets would be required to spend at least 5% of those funds every year shoring up the healthcare safety net or otherwise improving access to care for Californians. If Blue Shield’s assets are worth $11 billion, as I’ve estimated, then a reasonable measure of the minimum community benefit it should provide in fulfillment of its nonprofit duty would be $500 million, or 5%, annually.
In response to my initial petition, Blue Shield’s management scoffed at the idea of conversion, with its CEO likening it to sightings of Bigfoot and the Loch Ness monster. Blue Shield, they proclaim, is far too committed to its nonprofit mission to consider such a thing.
Okay, Blue Shield, then start taking your nonprofit duties seriously. Give the public at least as much benefit as they would get if you converted and the billions in nonprofit assets you hold went to the community. If you mean what you say about wanting to stay nonprofit, show us the money--$500 million a year in community benefits.