Major Health Insurance Companies - Assignment Example

Major Health Insurance Companies Blue Cross and Blue Shield Association Originally, Blue Cross (BC) and Blue Shield (BS) were known to as different entities. Blue Cross Company used to cover the hospital charged, traditionally, whereas Blue Shield Company used to pay for physician services. Blue Cross: In 1929, Blue Cross plan was formed by Baylor University administrator. His concern was to provide health insurance to teachers. It was that time, when Dallas teachers were enduring relatively high rate of unpaid bills. The plan was actually covered with the 21 days hospital stay for six dollar per year. The patient paid five dollar per day where he paid the money out of his pocket for the first ten days. Earlier, hospitals used to occupy the billed patients, directly for all the services provided. At the time of depression, patients paid less for their bills and preferred the government-run hospitals, by abandoning the existing system of private hospitals. The entire system directly encouraged the model of health insurance, a prepayment plan. The Blue Cross Plans were initiated in accordance with American Hospital Association (AHA). Blue Shield: Earlier in 1939, the health insurance attempts were the outcome of both local government and customers. AHA was concerned about the consumer-organized voluntary prepayment plans along with the mandatory insurance. The plans like Blue Cross were predicted to set standards for the payment of medical care. It was not correct to negotiate the doctors payment by the hospitals. It was time; when AHA announced and demanded the need to have both medical and hospital insurance separate. The further plans lead the Blue Shield plan to come into existence, by 1939. In 1982, these two companies happened to be merged into ‘Blue Cross and Blue Shield Association (BCBSA)’. At turn of last century, these two companies merged as an Association and gave the birth to the concept of health insurance. It was the time, when health insurance used to be a very innovative concept in this history of United States. Currently, Blue Cross and Blue Shield Association is an independent name of a federation, which consists 39 independent health care insurance companies. It is providing health insurance in America, covering over 100 million of the population. The main headquarters of BCBS are presented in, Michingo Plaza and Chicago, Illinois. Over 80 years, its companies have worked in association with hospitals and physicians to provide the most affordable and better quality care in local communities nationwide. This association is providing such tools and information, which can be beneficial for the customers to attain right care at right time. It also provides the opportunities to work and invest in their local communities and to develop more innovative solutions regarding the betterment of healthcare quality and its affordability for their customers.[MAR15] It comprises two of the major products, Preferred/participating Provider Organization (PPOs) & Health Maintenance Organization (HMOs). PPOs: It is a medical care organization, allowing a substantial discount to its customers. If a person is the part of PPO plan, he/she would be paying less during the use of hospitals, doctors and other health ‘care plans joined within the network. Going for help out of the network would cost higher. HMOs: This organization provides or arranges the individuals, managed care for health insurance, self-funded health care benefit plans or other entities relating to the health care providers. The whole HMO plan is backed by the prepaid services. Conclusively, it provides us the opportunity to choose the execution of our health care. The annual revenue report of 2013 of BCBSA concludes the figure with 21.3 billion dollars. The organization has progressively made the increment 1.9 percent, in comparison to the revenue of 2012, 20.9 billion dollars. According to president of the association, the net income has been declined with 20 percent. It earned 40 billion dollars as net income in 2011 and 205 billion dollars in 2010. The cause in the net income has been occurred due to the decrement of its investors and increase in underwriting losses. By 2013, the total underwriting loss is of 117 million dollars which has set more challenging timeline for the organization. According to the organization, the economic pressures is influencing the health care and business providers widely, on the other hand the pocketbook issues are also affecting the consumers to make their paths towards the nonprofit health organizations. For the maintenance of persistence stability of BCBSA, its financial head is keeping the profit margins near to 1%.[Jay14] Today, Blue Cross and Blue Shield insurance companies are providing insurance plans under the both of the brands. They are offering health coverage almost in every US state. They are also acting as Medicare administrators in distinct regions to provide the services to both federal government employees and state government employees. The ‘Federal Employees Health Benefit Plan’ is providing this coverage under nationwide. It is covering near one-in-three Americans, under the consideration in every zip code, state and Federal Territory. The local communities of Blue Cross and Blue Shield are highly advantaging in such sectors and making their services plans liable to their own friends, neighbors and families. The 14-state Anthem Inc. is a publicly traded company, and is also the largest part of Blue Cross Blue Shield Plan. ‘The Health Care Service Corporation’ is acting as the largest non-investor member, along with five operations of Blue Cross Blue Shield plans in Southwest and Midwest (New Mexico, Taxes, Illinois, Montana, Oklahoma). Its other multi-state organizations include The Regence Group, Highmark and Mid-Atlantic. Currently it is occupying approximately 105 million Americans (accommodating 92% of professional providers and more than 96% of Hospitals). Its insurance plans & products are available to every segment of the American population, small businesses, individuals, and large employer groups. The organization is already enrolled with more than half of the retirees with their families and U.S Federal workers. It is currently serving 76% of the 500 Fortune companies and 85% of the 100 Fortune companies. As, the law of healthcare has been implemented in America, hence Blue Cross Blue Shield is looking forward to make the tomorrow’s healthcare system, serving with the mission statement of as the largest, affordable and high quality health care providers. References MAR15: , (LICHTENSTEIN), Jay14: , (Greene, 2014), Read More