• The rate of corporate restructuring, including mergers and acquisitions, non-profit HMO and hospital conversions, and demutualizations will accelerate. These marketplace pressures will force the legislature, Governor (along with input from the Division of Insurance and Dept. of Public Health) and Attorney General to seriously consider how these complex matters are to be reviewed. The holes in current regulatory oversight -- as evidenced by the acquisition of Central Massachusetts Health Care by Healthsource of N.H. in which no agency with jurisdiction oversaw the continuity of care or availability of medical services issue -- will be closed.
  
• The auto insurance market will experience dramatic changes, but the jury is out on the ultimate benefit to consumers and the market. Many more consumers than ever before will benefit from discounts on their rates. However, the carefully preserved rate cross-subsidization is in jeopardy of unraveling willy nilly as the market lumbers toward a competitive market with combinations of group programs and select safe driver deviations. To forestall the instability of the market, potential solvency concerns, pressures toward consolidation of market share and market players, and the negative impact on consumers, the planned January legislative hearings will provide for an airing of the critical issues affecting Massachusetts. Any legislative and regulatory response must recognize the need to allow consumers fair and equal access to justifiable discounts, while protecting consumers against short-term predatory pricing. The Massachusetts auto insurance system will evolve to a new, as yet undefined form.

Goals to Work Toward:

• The MA Division of Insurance should become more accountable to the public by following the open records laws and involving policyholders in matters affecting their insurers, particularly in matters of corporate restructuring: mergers, acquisitions, demutualizations, conversions. They may have to be assisted in this respect by the courts.
  
• The legislature will reform the mutual insurer governance laws to ensure policyholders rights and interests are more fully established and protected. Current law leaves mutual policyholder-owners, who represent nearly 40% of the Massachusetts market, subject to the whim of the mutuals' managements which now operate with near total impunity.