Washington Sues CareFirst Over $754 Million in Surplus

WASHINGTON, D.C. (AP) – The Attorney General’s Office has sued CareFirst and its Washington affiliate, Group Hospitalization and Medical Services, to enforce it obligations as a charitable institution.

Interim Attorney General Peter J. Nickles says Group Health, which does business as CareFirst BlueCross Blue Shield, is the largest health insurance plan in the metro area.

The insurer had a surplus of $754 million the end of 2007. According to the complaint, filed yesterday in D.C. Superior Court, the surplus exceeds the level required for legitimate charitable or nonprofit purposes.

Mr. Nickles says the company’s charter says its mission is to promote public health and that the excess surplus doesn’t serve the people who pay the premiums. CareFirst could not be reached for comment.

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