Many Americans recognize June 14 as Flag Day, but on that date this year in Lansing, Michigan's lieutenant governor joined a crowd of people to celebrate more than just the red, white, and blue.
June marked the 5th anniversary of one of the largest privatizations of a state agency in U.S. history—the sale of the government-owned Accident Fund of Michigan to the private insurance company Blue Cross and Blue Shield.
Successful privatization—the transfer of assets from government to the private sector—results in savings for taxpayers and improved quality for consumers. The privatized Accident Fund, Michigan's largest provider of workers compensation insurance, has been no exception.
The sale of the Fund to Blue Cross and Blue Shield in 1994 earned the state $255 million, and employees of the Fund now pull in competitive private-sector wages instead of drawing checks from the state treasury.
Disabled workers insured by the Fund are pleased to know that A.M. Best, the world's most respected insurance rating firm, now rates the privatized Accident Fund's financial condition as excellent.
Five years after privatization, the Accident Fund is still a winner—for taxpayers, company employees, and the disabled workers it insures.
For the Mackinac Center, this is Catherine Martin.