Does Anthem Own BCBS or Is It a Separate Entity

Anthem is a well-established health insurance company, but the question remains: does it own Blue Cross Blue Shield (BCBS) or are they separate entities? The answer lies in their complex relationship.

Anthem is actually a Blue Cross and Blue Shield Association (BCBSA) licensee, which means it has a contractual agreement with the BCBSA to operate under the BCBS name and brand.

The BCBSA is a national federation of 36 independent Blue Cross and Blue Shield companies, and Anthem is one of these companies. This means Anthem is not the sole owner of BCBS, but rather a part of a larger network of companies that share the BCBS brand.

Anthem's relationship with BCBS is a licensing agreement, not a direct ownership.

Anthem's Relationship with BCBS is a crucial aspect to understand when considering the ownership question. Anthem is a health insurance company that has a significant partnership with Blue Cross Blue Shield (BCBS) associations.

Anthem is a licensed Blue Cross and Blue Shield affiliate in several states. This means they have a close relationship with the local BCBS associations.

The partnership between Anthem and BCBS allows them to share resources and expertise. This collaboration enables Anthem to offer BCBS-branded health insurance plans to its customers.

Anthem's relationship with BCBS is governed by a contractual agreement. This agreement outlines the terms and conditions of their partnership.

Anthem's affiliation with BCBS does not necessarily imply ownership. The company's relationship with BCBS is a strategic partnership rather than a corporate ownership structure.

In 2007, the DMHC launched an investigation into Anthem's business practices, specifically regarding its handling of medical claims.

The investigation found that Anthem had been engaging in unfair business practices, including failing to timely pay claims and imposing excessive fees on its members.

As a result of the investigation, Anthem agreed to settle with the DMHC, agreeing to pay a $6 million fine and implement changes to its business practices.

Anthem also agreed to provide refunds to its members who had been affected by its unfair business practices.

This settlement marked a significant turning point for Anthem, as it was forced to take steps to improve its handling of medical claims and treat its members more fairly.

BCBS (Blue Cross Blue Shield) is a network of 36 independent health insurance companies that are not owned by Anthem, but are rather a separate entity.

In 2020, Anthem sold its BCBS licenses in several states to other companies, including Cigna in Ohio and Connecticut, and Highmark in New York.

The Blue Cross merger between Cambia Health Solutions and Blue Cross and Blue Shield of North Carolina (Blue Cross NC) makes it less likely for Anthem to expand using the valuable Blues brand in new markets. This strategic affiliation merges operations and management of two companies operating Blues plans on the East and West coasts.

Cambia, which operates Blue plans in Idaho, Oregon, Washington, and Utah, and Blue Cross NC are forming a "strategic affiliation" that makes it difficult for Anthem to buy other Blues plans. This is because the Blue Cross Blue Shield Association rules prevent Anthem from using the well-recognized Blue Cross and Blue Shield brand in regions where Anthem doesn’t have the Blue Cross license or own a Blues plan.

The Blue Cross Blue Shield Association rules are a major obstacle for Anthem's expansion plans. These rules prevent Anthem from marketing certain products in states where it doesn’t have the Blue Cross license.

The Cambia-Blue Cross NC deal isn’t a full asset merger, so the regulatory hurdles it faces aren’t expected to be as intense. This means that the transition to the strategic affiliation will be subject to regulatory approval in North Carolina, Oregon, Washington, Idaho, and Utah.

In states where Anthem doesn’t have the Blue Cross license, it operates under the Amerigroup brand. This is because Anthem cannot market certain products like UnitedHealth Group, Aetna, Cigna, and Humana given the Blue Cross Blue Shield Association rules.

Blue Cross Blue Shield owner Anthem is changing its name to Elevance Health Inc. This rebranding effort aims to position the company as a broader player in the healthcare industry.

Anthem's core business remains its Blue Cross Blue Shield plans, which will retain their current names. The plans generated approximately $121.73 billion of its $136.94 billion in operating revenue last year.

Elevance Health's new name is a mash-up of the words "elevate" and "advance", reflecting the company's expanded focus beyond health insurance. Anthem CEO Gail Boudreaux believes the name more accurately reflects the business.

Anthem has been expanding its services beyond health insurance, including acquiring a behavioral-health company and a home-based healthcare management company. The company also has a drug-benefit manager and releases data analytics and digital tools.

Insurers like Elevance Health are diversifying their businesses to add potentially higher-margin and faster-growing operations. This strategy aims to attract a premium valuation like that of UnitedHealth Group Inc.

The rebranding effort may face challenges in connecting with consumers, especially if they continue to encounter the Anthem brand through their health coverage.