The Blue Cross and Blue Shield Association is set to pull the plug on its renegade Cleveland plan.
The association last week sent Blue Cross and Blue Shield of Ohio a letter requesting a meeting to coordinate its removal from the Blues system.
The Blues board of directors voted in June and again in September to strip the plan of its license to use the Blues name and service marks should it proceed with a plan to sell most of its assets to Columbia/HCA Healthcare Corp., the giant for-profit hospital chain.
Both sides have agreed to take no definitive action until Oct. 18, when a federal judge will decide whether the association has the right to terminate the plan's license agreements.
The plan filed a lawsuit asking for a preliminary injunction to prevent the removal of its license (July 1, p. 12).
However, the association has another weapon in its arsenal.
Last week's letter notified the plan that its license agreements actually terminated on Sept. 9, although the association has not officially disconnected the plan.
According to the letter, the agreements terminate automatically if the plan is sued by someone seeking the appointment of a legal custodian and if that action is not dismissed within 60 days.
Ohio Attorney General Betty Montgomery filed such a suit July 11 (July 15, p. 14).
The letter said the Ohio Blues "is obligated to cease all use of the Blue marks promptly and to change its corporate name to eliminate all reference to Blue Cross and Blue Shield. (The plan) is further obligated...to provide appropriate notice to its customers that it is no longer a licensee."
The Ohio Blues said it will "take all steps required to protect its customers' interests." However, a spokesman declined to say what if anything the plan will do to prepare the nearly 1.5 million people it covers.
Columbia reportedly would subtract $50 million from the $299.5 million purchase price if it doesn't get the Blues name and trademarks.