The company I work for is Blue Cross Blue Shield of Minnesota (BCBS). BCBS of MN is a private non-profit corporation that provides health insurance services in Minnesota under a license with the Blue Cross and Blue Shield Association. BCBS also offers dental, vision, Medicare supplement coverage, as well as workers' compensation insurance, health assessment, and health care management services. The organization is headquartered in Eagan, Minnesota and employs approximately 3,700 people throughout Minnesota, with offices in Eagan, Virginia, Aurora, Duluth, Moorhead, St. Cloud, Mankato and Rochester. Nationally BCBS Association is national federation of 38 independent, community-based and locally operated Blue Cross and Blue Shield companies. BCBS companies provide healthcare coverage for nearly 100 million people. Nationwide, more than 96% of the hospitals and 91% of professional providers contract directly with BCBS companies. My job is to direct the Exchange Program Office. The Exchange Program deals with all the mandated changes driven by the Affordable Care Act or Obamacare. The IT part of the exchange is how BCBS will connect with the State insurance exchange. I will conduct a STEEP analysis on BCBS and the Exchange Program Office. Background
BCBS of MN was the first “Blue” health plan in the nation. Originally the BCBS story began in 1933, when seven St. Paul hospitals teamed up to form the “Minnesota Hospital Association,” the nation’s first prepaid health care network. An early advertisement depicts a nurse with a blue cross on her sleeve. An iconic logo is born, and BCBS became the first-ever health plan to use the “Blue Cross” name. Less than a decade after BCBS became the first Blue plan, the name and symbol are adopted by the national Blue Cross Association. “Blue Cross” goes on to become one of most recognized and trusted health care brands in the world. BCBS of Minnesota is the largest health plan in Minnesota, with more members, the largest network of providers, and more products and services than any other plan in our state. Our 2.7 million members can be found in every Minnesota county, all 50 states and on four continents. Approximately one in three Minnesotans has a Blue Cross membership card. Blue Cross operates as a nonprofit organization – which means our resources are used to serve stakeholders, not stockholders. BCBS pays more than $100 million in taxes and assessments every year. Approximately 90 cents of every health care dollar collected by Blue Cross is used to pay for members’ health care costs. We have an administrative cost level of less than 10 cents of every dollar – one of the lowest levels in the country. Lastly BCBS service center handles more than 3.4 million calls every year with high satisfaction rates. STEEP Analysis
BCBS of MN is independent from the other 37 BCBS operated companies and is one of the thought leaders within the overall organization. It has been my observation that groups of BCBS companies form subsidiary partnerships to buy a software solution or create a type of ancillary insurance. For example BCBS of MN had a division of business providing life insurance. During one of reorganizations that occur from time to time BCBS wanted to remove itself from the life insurance business. This must have been a common decision within the Association that a few “Blues” formed a company call USAble. BCBS of MN sold exclusive life insurance rights to USAble for ten years and USAble took all of the servicing and operation of all life insurance products. Other groups of “Blue” purchased controlling shares of Bloom Health (a leading provider of web portal software for healthcare).
There are a few key areas with tremendous impact in today’s health insurance market. Obamacare or the Affordable Care Act (ACA) is fundamentally transforming how health insurance companies operate mostly doing away with underwriting. At this point it is...