System change problems and problems with implementing new federal laws are affecting service levels at Regence Group, the company says.

Regence, Portland, Ore., is a consortium of Blue Cross and Blue Shield plans that have a total of about 3 million enrollees in Idaho, Oregon, Utah and Washington state.

Regence changed information systems at the beginning of the year, and, like other health insurers, it has been racing to implement provisions of the Patient Protection and Affordable Care Act of 2010 (PPACA).

“Regence is currently experiencing some operational difficulties which have unfortunately impacted our ability to provide the level of service our members, customers and providers have come to expect of us,” the company says in a statement. “While these issues are temporary, we deeply regret that we have fallen short on our service commitments to a small portion of our more than 1 million members, as it is our goal is to fully serve all of our members all of the time.”

Mike Kreidler, the Washington state insurance commissioner, says in a statement that insurance regulators from Regence market states met with Regence executives last week to discuss the problems.

Washington state believes that medical claims from tens of thousands of retirees have gone unpaid for months, and that, in about 200 cases, the company withdrew money from bank accounts from people who did not owe the money and were not necessarily Regence plan enrollees, Kreidler says.

“The Regence Group needs to gets its act together,” Kreidler says. “The status quo clearly isn’t acceptable.”

- Allison Bell

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