Blue Shield of California Dedicates Unit to Public Sector Accounts
Following its lucrative contract over the last few years with CalPERS, Blue Shield of California in March created a business unit dedicated to "labor, trust and other large public-sector accounts" in its new Large Group Business Unit, the San Francisco Business Times reports. The move is part of Blue Cross' effort to pursue "public agency and union contract[s] in a big way," according to the Business Times.
CalPERS has saved as much as $40 million annually since 2004 after Blue Shield eliminated some high-cost hospitals from its HMO provider network. The program expects to save $45 million next year.
Earlier this month, the insurer signed a contract with Riverside County to provide coverage for 10,000 enrollees. In May, the California Correctional Peace Officers Association signed a contract to enroll 25,000 members in health plans, and the Santa Barbara International Board of Electrical Workers entered a contract to enroll 600 members. The International Alliance of Theatrical Stage Employees, Local 33, enrolled 2,500 members in Blue Shield health plans in April.
Blue Shield Chair, President and CEO Bruce Bodaken said, "We think a number of other large and mid-sized government and commercial employers are interested in what we've achieved with CalPERS, and (potentially) in a long-term partnership."
According to Glenn Smith, a senior consultant at Woodruff-Sawyer and an expert on public agency-related benefits issues, Blue Shield's plans, which emphasize disease management and wellness, are well-suited for government agencies and unions because they tend to have an older work force (Rauber, San Francisco Business Times, 7/15).