Tuesday, June 23, 2015

125 Things to Know About the 'Big 5' Insurers

BlueCross BlueShield

Company basics

1. Blue Cross was founded in 1929 as a way to provide prepaid hospital care. A decade later, Blue Shield was founded to provide reimbursement for physician services. The Blue Cross Association and National Association of Blue Shield Plans merged in 1982 to form the Blue Cross and Blue
Shield Association.

2. Scott Serota currently leads BCBSA as president and CEO. He has held this position since 2000, following terms as COO, a senior executive and executive vice president for system development. He previously served as president and CEO of Chicago-based Rush Prudential Health Plans, which was sold to WellPoint Health Networks in 2000.

3. The BCBS system offers a full spectrum of healthcare coverage, including coverage for large employer groups, small businesses and individuals, as well as Medicaid and Medicare plans.

4. One in three Americans — 106 million — are BCBS beneficiaries. BCBS companies also hold the largest privately underwritten health insurance contract in the world through the Federal Employee Program, or the Federal Employee Health Benefits Program, which insures more than half — 5.3 million — of federal government employees, dependents and retirees, according to the payer. BCBS provides 52 million Medicaid and 42 million Medicare beneficiaries with healthcare coverage as well.

5. BCBS companies operate in every U.S. state, the District of Columbia and Puerto Rico.

6. The Blues are entirely independent and license one or both of Blue Cross and Blue Shield's brands to operate in distinct markets across the country. Of the 36 BCBS companies, the largest is the publicly-traded Anthem, which stretches across 14 states, and includes Rocky Mountain Hospital and Medical Service (Colorado and Nevada), Anthem Health Plans (Connecticut), BCBS of Georgia, BCBS Healthcare Plan of Georgia, Anthem Insurance Companies (Indiana), Anthem Health Plans of Kentucky, Anthem Health Plans of Maine, RightCHOICE Managed Care (Missouri), Healthy Alliance Life Insurance Co. (Missouri), HMO Missouri, Anthem Health Plans of New Hampshire, Community Insurance Co. (Ohio), Anthem Health Plans of Virginia, BCBS of Wisconsin.

Health Care Service Corp., CareFirst, The Regence Group and Highmark also serve multiple states. Health Care Service Corp. operates the following plans: BCBS of Illinois, BCBS of Montana, BCBS of New Mexico, BCBS of Oklahoma and BCBS of Texas. CareFirst includes CareFirst of Maryland, CareFirst BlueChoice and Group Hospitalization Medical Services. The Regence Group includes Regence BlueShield of Idaho, Regence BCBS of Oregon, Regence BCBS of Utah and Regence Blue Shield (Washington). Highmark includes Highmark BCBS (Pennsylvania), Highmark Blue Shield (Pennsylvania), Highmark BCBS West Virginia and Highmark BCBS Delaware.

Finances

7. Chicago-based Health Care Service Corp., a BCBS licensee and the largest nonprofit health insurer in the country, posted a $281.9 million loss in 2014, compared to a $684.3 million surplus the year before, due to a significant increase in the number of medical claims as a result of the Patient Protection and Affordable Care Act and people gaining insurance coverage through the exchanges.

8. Anthem, the largest BCBS company, reported better-than-expected profits for the first quarter of 2015, posting a net income of $856.2 million, up from $701 million for the first quarter last year.

9. The nonprofit status of some Blues outfits has been a point of contention. While some companies are publicly traded, such as Anthem, others have maintained a nonprofit status. Blue Shield of California was stripped of its state tax-exempt status in August 2014, but the news was announced this March. The California Franchise Tax Board revoked its status, which the payer has held since it was founded in 1939, after a state audit. Though no information has been released, the tax-exempt status was likely removed because Blue Shield of California was holding $4.2 billion in its financial reserves, which is four times larger than BCBSA requires its members to hold to pay claims, according to NPR. The company has contributed $325 million to its charitable foundation in the last 10 years.

10. Many payers, including BCBS plans, requested double-digit rate increases for plans created under the PPACA next year to cover the medical costs of the newly insured. Blues plans in Maryland, New Mexico and Tennessee all requested increases of 30 percent or more, and BCBS Illinois requested a 23.4 percent increase for individual plans and a 29.1 percent increase for an HMO plan, according to Politico. BCBS of North Carolina is asking for a 25.7 percent increase in premiums, according to Triad Business Journal. The increased rates have not yet been approved.

Value-based programs

11. The Blues collectively boosted value-based care spending to $71 billion in 2014, reflecting a 9 percent increase in claims tied to value-based programs since 2013.

12. Patient-centered BCBS programs generated $1 billion in savings in 2013, according to BCBSA. The portfolio includes accountable care organizations, patient-centered medical homes and other programs for a total of 570 patient-centered care programs for more than 25 million customers and 228,000 physicians.

13. BCBS has launched 450 ACOs across 32 states with more than 111,000 physicians.

14. The Blues host 69 PCMHs in 43 states and Washington, D.C. More than 56,000 physicians participate in the payer's PCMH models.

The BCBS antitrust lawsuits

15. Two federal antitrust lawsuits against all BCBS companies and BCBSA have recently grabbed headlines. The lawsuits allege BCBS insurers' "cartel-like" operations limit competition and drive up premiums.

16. One case was brought on behalf of healthcare providers and the other on behalf of individual and small-employer customers. The suits were combined into one claim by a federal judicial panel in Alabama and the plaintiffs are now seeking class-action status.

17. BCBS denied the allegations. It says their licensing model — which gives companies exclusive rights to use the BCBS brand in specific regions — is not unlawful and has been in existence for decades without previous antitrust action.

18. The case comes down to the judicial interpretation of the BCBS model. Whether BCBS is a franchise or was purposefully designed to reduce competition is the crux of the case, according to Barak D. Richman, a Duke law professor.

19. The plaintiffs have conflicting interests. Glenn Melnick, a professor at the University of Southern California, pointed out in The Wall Street Journal that higher reimbursement rates are of interest for providers, but would lead to higher premiums for customers.

20. No judgments have been made on the merits of the case, but it was not dismissed last year by U.S. District Judge R. David Proctor, who said the plaintiffs "have alleged a viable market-allocation scheme."

Rankings, disputes and news

21. According to athenahealth's annual PayerView report, the Blues have the strongest presence in the Top 10 Performers, with BCBS Washington Regence, BCBS Maryland, BCBS Louisiana, BCBS Pennsylvania Capital BlueCross, BCBS North Carolina and BCBS North Carolina Blue Medicare holding six spots. Payers were ranked based on metrics such as days in accounts receivable, claim resolution rate, denial rate and more.

22. BCBS plans were rated the No.1 plan for overall member satisfaction for the Heartland region — which includes Arkansas, Iowa, Kansas, Missouri, Nebraska and Oklahoma — and the Illinois-Indiana region, Ohio, New Hampshire, Pennsylvania and Texas, where it tied for No. 1 with UnitedHealthcare, according to the annual J.D. Power Member Health Plan Study. The study is based on consumer responses in six categories: coverage and benefits, provider choice, information and communication, claims processing, cost and customer service.

23. CareFirst BCBS announced in May it was the victim of a cyberattack that potentially compromised the data of almost one-third of its customers — 1.1 million members — making it the third hacking discovered at a BCBS company since the beginning of the year. Anthem also announced a breach in February this year, putting information at risk for approximately 80 million former and current customers and employees. A cyberattack reported in March at Premera Blue Cross compromised the data of 11 million customers.

24. Pittsburgh-based UPMC and Highmark have been embroiled in a dispute since 2011, when the payer moved to acquire West Penn Allegheny Health System, UPMC's biggest competitor. In response, UPMC decided not to renew its contract with the payer, forcing Highmark customers to seek care outside of the system or pay out-of-network fees. Most recently, a judge ordered UPMC to continue to provide in-network access to Highmark Medicare Advantage members until 2019, or the duration of the consent decree the companies entered into in June 2014.

25. BCBSA announced in April plans to launch a private health insurance exchange to help transition Medicare-eligible retirees from group health benefits to individual Medicare coverage. The exchange will offer supplemental Medicare insurance, or Medigap, as well as Medicare Advantage and Medicare Part D plans.                                                                                          

Blue Cross plans, state by state
Alabama: Blue Cross and Blue Shield
Alaska: Premera Blue Cross Blue Shield
Arizona: Blue Cross and Blue Shield
Arkansas: Blue Cross and Blue Shield
California: Anthem Blue Cross; Blue Shield
Colorado: Anthem Blue Cross and Blue Shield
Connecticut: Anthem Blue Cross and Blue Shield
Delaware: Highmark Blue Cross Blue Shield
District of Columbia: CareFirst Blue Cross Blue Shield
Florida: Blue Cross and Blue Shield
Georgia: Blue Cross and Blue Shield
Hawaii: Blue Cross Blue Shield of Hawaii
Idaho: Blue Cross; Regence BlueShield of Idaho
Illinois: Blue Cross and Blue Shield
Indiana: Anthem Blue Cross Blue Shield
Iowa: Wellmark Blue Cross and Blue Shield
Kansas: Blue Cross and Blue Shield
Kentucky: Anthem Blue Cross and Blue Shield
Louisiana: Blue Cross and Blue Shield
Maine: Anthem Blue Cross and Blue Shield
Maryland: CareFirst Blue Cross Blue Shield
Massachusetts: Blue Cross and Blue Shield
Michigan: Blue Cross and Blue Shield
Minnesota: Blue Cross and Blue Shield
Mississippi: Blue Cross and Blue Shield
Missouri: Anthem Blue Cross Blue Shield; BlueCross and BlueShield of Kansas City
Montana: Blue Cross and Blue Shield
Nebraska: Blue Cross and Blue Shield
Nevada: Anthem Blue Cross and Blue Shield
New Hampshire: Anthem Blue Cross and Blue Shield
New Jersey: Horizon Blue Cross and Blue Shield
New Mexico: Blue Cross and Blue Shield
New York: BlueCross & BlueShield of Western; BlueShield of Northeastern; Empire Blue Cross and Blue Shield; Excellus BlueCross BlueShield
North Carolina: Blue Cross and Blue Shield
North Dakota: Blue Cross and Blue Shield
Ohio: Anthem Blue Cross and Blue Shield
Oklahoma: Blue Cross and Blue Shield
Oregon: Regence BlueCross BlueShield of Oregon
Pennsylvania: Highmark Blue Shield; Capital BlueCross (Harrisburg); Highmark Blue Cross Blue Shield (Pittsburgh); Independence Blue Cross (Philadelphia)
Puerto Rico: BlueCross BlueShield of Puerto Rico
Rhode Island: Blue Cross and Blue Shield
South Carolina: Blue Cross and Blue Shield
South Dakota: Wellmark Blue Cross and Blue Shield
Tennessee: Blue Cross and Blue Shield
Texas: Blue Cross and Blue Shield
Utah: Regence BlueCross BlueShield of Utah
Vermont: Blue Cross and Blue Shield
Virginia: Anthem Blue Cross and Blue Shield and CareFirst BlueCross BlueShield
Washington: Premera Blue Cross; Regence BlueShield
West Virginia: Highmark Blue Cross Blue Shield West Virginia
Wisconsin: Anthem Blue Cross and Blue Shield
Wyoming: Blue Cross and Blue Shield

Click here to learn about the remaining 'Big Five' insurers.

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