[TRANSCRIPT OF SPEECH ABOUT HISTORY OF EMPLOYEES HEALTH INSURANCE]

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86-00964R000100030024-8
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 14, 2016
• Document Release Date: April 18, 2003
• Sequence Number: 24
• Content Type: TRANS

Approved For Relsse 2003/05/27: CIA-RDP86-00964R0Q,00030024-8
We wo':ld like to talk to you about a matter of life and death - and
the little bit of mis:_ery in between. Because in Insurance Branch that
is what we are concerned with. We are interested in the lives of your laved
ones who must carry on after your death. While youtre still around, we
are interested in doing what we can to alieviate some of that misery
that goes on in the form of hospital bills that exceed $100 per day when
you have to have your gallbladder taken out or your tomboy duaghter falls
from the top of your largest maabie tree and the medical bills seem to
accumulate faster than the national debt.
The beginning of this morbid story as far as we are concerned goes back to
pre CIA days when there was no Insurance Branch and no GEHA. Government
employees wire mostly left on their own to provide themselves with life
insurance coverage and protection against medical expenses. They did so
either as individ , subscribers to insurance plans or by forming
employee organizations or fraternal groups in order to take advantage
of lower group rates and better benefits. When the Agency was born, its
employees were participating in the W,IEPA life insurance plan and the
Blue Cross - Blue Shield hospitalization plan by pr:Ving their premiums
on a hand collection basis to an employee of the Office of Finance.
Payments were con sdlidated and sent to the respeoctive plans. Employees
filed their own claims directly with the plans.
Approved For Release 2003/05/27 : CIA-RDP86-00964R000100030024-8
 Approved For Reljse 2003/05/27: CIA-RDP86-00964R0g00030024-8
As a result,, Blue Cross was compiling a wealth of information on Agency
employees, their dependents, and their medical histories and locations.
Tr, order to overcome this security nightmare, the Agency sought out an
insurance carrier which would provide a group health insurance policy
for its employees on a no-names basis. One company, Mutual of Omaha,
was agreeable to such an arrangement and developed a plan for the Agency.
However, before it could be put into effect another obstable arose in
the form of a District of Columbia insurance regulation requiring group
insurance plans to have a minimum participation of 75% of those eligible.
To disclose 75% of the Agency strength was obvicUsly unacceptable. As
a means of circumventing this problem, The Agency decided to form an
"employee organization", the memberstip of which would be limited to
employees of CIA. By so doing the new group health insurance plan would
be written for the benefit of the "employee orgaai7tiontt members and
would have 100% participation since the only purpose in joing would be
to join the health insurance Plan. Consequently, on 29 June 1948 the
Government Employees Health Association was accepted as a:,oorporatio*
under the laws of the District of Columbia and the Agency was in the
insurance business. With a branch that was contracting for health
insurance benefits and internally settling claims, it was inevitable
that it would expand to other forms of insurance. Since that time
some plans have come and gone, such as the PAMA hospitalization plan
for parents. That plan phased out when Medicare came in. There was
also the DENTA Plan whi d7 was a financial fiasco for the underwriter but
a boon to all those who had bad teeth and were smart enough to join it
while it lasted.
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( Slides)
 3
Who decides what plans will be provided and -what the benefits and costs
of those plans will be? The GEHA Board of Directors which you as members
of GEHA elect each January.
( Slide )
They total 9 - tw from each of the directorates and one from the
Director's Office., for a representation of all employees of the entire
Agency.
How does a no-names insurance plan function?? Primarily on faith.
In the ca'':e of life insurance................
In the case of health insurance.*.............
STATINTL
Approvee'f2~*fE?BZ_:CIA-RDP86-009648000 00030024-8
CLAIMS_
Approved For Release 2003/05/27 : CIA-RDP86-00964R000100030024-8