Blue Cross Blue Shield Association


Blue Cross Blue Shield Association, also known as BCBS, BCBSA, or The Blues, is a United States–based federation with 33 independent and locally operated BCBSA companies that provide health insurance to more than 115 million people in the U.S. as of 2022.
It was formed in 1982 from the merger of its two namesake organizations. Blue Cross was founded in 1929 and became the Blue Cross Association in 1960. Blue Shield emerged in 1939, and the Blue Shield Association was created in 1948. Its headquarters are at the Aon Center at 200 E. Randolph Street in Chicago, Illinois.
BCBSA claims to control access to the Blue Cross and Blue Shield trademarks and names across the United States and in more than 170 other countries, which it then licenses to the affiliated companies for specific, exclusive geographic service areas. It has affiliated plans in all 50 states, Washington, D.C., and Puerto Rico, and licensees offering plans in several foreign countries; it also participates in the nationwide health insurance program for employees of the United States federal government.
BCBSA manages communications between its members and the operating policies required to be a licensee of the trademarks. This permits each BCBSA company to offer nationwide insurance coverage through its BlueCard provider network and claims reimbursement program even though it operates only in its designated service area.

History

Blue Cross and Blue Shield developed separately. Blue Cross provided coverage for hospital services, and Blue Shield covered physicians' services.
Blue Cross is a name used by an association of health insurance plans throughout the United States. Its predecessor was developed by Justin Ford Kimball in 1929, while he was vice president of Baylor University's health care facilities in Dallas, Texas. The first plan guaranteed teachers 21 days of hospital care for $6 a year, and was later extended to other employee groups in Dallas, and then nationally. The American Hospital Association adopted the Blue Cross symbol in 1939 as the emblem for plans meeting certain standards. In 1960, the AHA commission was superseded by the Blue Cross Association. Blue Cross severed its ties with the AHA in 1972.
Blue Shield was developed by employers in lumber and mining camps of the Pacific Northwest to provide medical care by paying monthly fees to medical service bureaus composed of groups of physicians. In 1939, the first official Blue Shield plan was founded in California. In 1948, the symbol was informally adopted by nine plans called the Associated Medical Care Plan, and was later renamed the National Association of Blue Shield Plans.
In the 1960s, the U.S. government chose to partner with Blue Cross and Blue Shield companies to administer Medicare.
In 1982, Blue Shield merged with The Blue Cross Association to form the Blue Cross and Blue Shield Association.
Prior to 1986, organizations administering BCBS were tax exempt under 501 as social welfare plans. However, the Tax Reform Act of 1986 revoked the exemption because the plans sold commercial-type insurance. They became 501 organizations, subject to federal taxation, but entitled to "special tax benefits" under IRC 833.
In 1994, BCBS changed to allow its licensees to be for-profit corporations. During 2010, Health Care Service Corporation, the parent company of BCBS in Texas, Oklahoma, New Mexico, Montana and Illinois, nearly doubled its income to $1.09 billion in 2010, and began four years of billion-dollar profits. In the final spending bill for FY 2015 after much lobbying since 2010, nonprofit Blue Cross and Blue Shield plans continue to have special tax breaks that were understood to be threatened by the Affordable Care Act of 2010.

Current organization

Blue Cross and Blue Shield insurance companies are licensees, independent of the association and traditionally of each other, offering insurance plans within defined regions under one or both of the association's brands. Blue Cross Blue Shield insurers offer some form of health insurance coverage in every U.S. state. They also act as administrators
of Medicare in many states or regions of the U.S.
The Blue Cross Blue Shield Federal Employee Program is a nationwide option under the Federal Employees Health Benefits Program for U.S. federal government employees and retirees and has been part of FEHB since FEHB's inception in 1960. FEP enrolls over half of the federal workforce, with over 5 million members, making it the largest insurer of federal employees and the largest single health plan group in the world.
The association is headquartered in the Michigan Plaza complex in the Chicago Loop area of Chicago, Illinois.

Multi-state member organizations

Single-state members include the following organizations.
Blue Cross Blue Shield of Arizona is a non-profit healthcare organization founded in 1939. BCBSAZ partners with non-profit "Discovery Triangle Development Corporation" to launch a Farm Express mobile market.

Arkansas

Founded in 1948, Arkansas Blue Cross Blue Shield is an independent licensee of the Blue Cross Blue Shield Association, and the largest healthcare provider in the state. It donated $1.98 million to The Walton College of Business toward founding its Robert L. Shoptaw Master of Healthcare Business Analytics Program. In August 2022, more than 12,000 members of Arkansas Blue Cross were affected by a ransomware attack on a former affiliate, North Highland Company, LLC.

Idaho

Blue Cross of Idaho and Regence BlueShield Idaho are separate companies and compete throughout the state.

Kansas

Blue Cross and Blue Shield of Kansas was founded in 1942 by Sam Bartham, later becoming an independent licensee of the Blue Cross Blue Shield Association.

Louisiana

Blue Cross Blue Shield of Louisiana is a tax-paying non-profit that was founded in 1934 in New Orleans. An independent licensee of the BCBSA, it is a privately held mutual company without shareholders, which is wholly owned by its policyholders.

Minnesota

Blue Cross Blue Shield of Minnesota was founded in 1933, with 3,500 employees reported in 2022.

Mississippi

Blue Cross Blue Shield of Mississippi was formed as a privately held company in 1954. In 1948, it was converted to a non-profit. In 1973, its name was changed from Mississippi Hospital and Medical Service to Blue Cross & Blue Shield of Mississippi, Inc., which, in 1996, was converted from a non-profit membership corporation to a mutual insurance company, with the name again changed, to Blue Cross & Blue Shield of Mississippi, A Mutual Insurance Company. During 2022, BCBS and University of Mississippi Medical Center network entered conflict over who is to blame for an increasing lack of covered care in the state. Media reported that UMMC had paid close to $279,000 for digital advertising, commercials, and billboards to attack BCBS, which, in subsequent months, sued the hospital for defamation. In December 2022, UMMC and BCBS reached a new contractual agreement.

Nebraska

Blue Cross Blue Shield of Nebraska was founded in 1939. On July 1, 2018, BCBS Nebraska formed GoodLife Partners Inc., a mutual holding company, to conduct its noninsurance businesses. The company retained the Blue Cross brand, converting from mutual ownership to a stock company wholly owned by GoodLife.

New York

Excellus BlueCross BlueShield is a non-profit health insurance company headquartered in Rochester, New York. It is part of the Blue Cross Blue Shield Association. In 2010, Excellus was Upstate New York's largest nonprofit health plan.
In 2001, Excellus merged with Univera Healthcare,, based in Buffalo, New York. Univera retained its name and is separate from Excellus BCBS. Excellus was the target of a cyberattack in 2015, in which 10.5 million records were hacked, and cost the company 17.5 million dollars. The company's Blue Cross Blue Shield subsidiaries have been known as:
  • BlueCross BlueShield of Central New York
  • BlueCross BlueShield of the Rochester Area
  • BlueCross BlueShield of Utica-Watertown