Blue Cross Blue Shield of Massachusetts (BCBSMA) is a state licensed

nonprofit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...

private

health insurance Health insurance or medical insurance (also known as medical aid in South Africa) is a type of insurance that covers the whole or a part of the risk of a person incurring medical expenses. As with other types of insurance, risk is shared among ma ...

company under the

Blue Cross Blue Shield Association Blue Cross Blue Shield Association (BCBS, BCBSA) is a federation, or supraorganization, of, in 2022, 34 independent and locally operated BCBSA companies that provide health insurance in the United States to more than 106 million people. It was f ...

with headquarters in

Boston Boston (), officially the City of Boston, is the state capital and most populous city of the Commonwealth of Massachusetts, as well as the cultural and financial center of the New England region of the United States. It is the 24th- mo ...

. The Boston location located on 133 Federal Street is currently under study as a pending

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by the

Boston Landmarks Commission The Boston Landmarks Commission (BLC) is the historic preservation agency for the City of Boston. The commission was created by state legislation i1975 History Urban renewal in the United States started with the Housing Act of 1949, part of Preside ...

History

BCBSMA formed in 1988 after the merger of Blue Cross and Blue Shield of Massachusetts. In 1992 it offered an

HMO In the United States, a health maintenance organization (HMO) is a medical insurance group that provides health services for a fixed annual fee. It is an organization that provides or arranges managed care for health insurance, self-funded heal ...

plan along with the rise of

managed care The term managed care or managed healthcare is used in the United States to describe a group of activities intended to reduce the cost of providing health care and providing American health insurance while improving the quality of that care ("man ...

in the 1990s. BCBSMA has

non-profit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...

status as a health insurer and has 2.8million policyholders, the largest number of any insurer in

Massachusetts Massachusetts (Massachusett language, Massachusett: ''Muhsachuweesut assachusett writing systems, məhswatʃəwiːsət'' English: , ), officially the Commonwealth of Massachusetts, is the most populous U.S. state, state in the New England ...

, with most policyholders insured through employers. The number of policyholders dropped slightly between the first and second quarters of 2011, due to the

economy An economy is an area of the production, distribution and trade, as well as consumption of goods and services. In general, it is defined as a social domain that emphasize the practices, discourses, and material expressions associated with the ...

and layoffs. The organization's compensation for its departing

CEO A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...

, Cleve Killingsworth, totaled $8.6million in 2010. When this was reported in 2011, public anger and a four-month investigation from the

Massachusetts Attorney General The Massachusetts Attorney General is an elected constitutionally defined executive officer of the Massachusetts Government. The officeholder is the chief lawyer and law enforcement officer of the Commonwealth of Massachusetts. The officeholder ...

followed. BCBSMA ultimately credited $4.2million, representing Killingsworth's

severance Severance may refer to: Arts and entertainment * ''Severance'' (film), a 2006 British horror film * ''Severance'' (novel), a 2018 novel by Ling Ma *''Severance'', a 2006 short-story collection by Robert Olen Butler * ''Severance'' (TV series), a ...

, off policyholders' premiums (~$3 per policyholder). On January 20, 2022, the company announced that CEO Andrew Dreyfus will resign from his position after 12 years on the job.

Alternative quality contracts and reform

The company has received praise for its innovative alternative quality contract (AQC) payment model. In 2007, then-CEO Cleve Killingsworth set a six-month deadline for the company to come up with a new payment plan to offer

health care provider A health care provider is an individual health professional or a health facility organization licensed to provide health care diagnosis and treatment services including medication, surgery and medical devices. Health care providers often receive ...

s. Killingsworth thought existing pay for performance initiatives were insufficient to prevent billions of dollars in wasteful health care spending that either harmed or did not help patients. AQCs were established in January 2009 and they serve as a model for

global payment Bundled payment is the reimbursement of health care providers (such as hospitals and physicians) "on the basis of expected costs for defined episodes of care." It has been described as "a middle ground" between fee-for-service reimbursement (in whi ...

s—in contrast to the fee-for-service model, which encourages excessive treatments—in the state. AQCs were envisioned as a way to increase provider accountability. They are based on the capitation approach that was tried in the 1990s, but with a bonus for patient quality outcomes to serve as a disincentive against providers neglecting patients. The word "capitation" was discouraged during company meetings, as it proved unpopular with providers under the

of the 1990s. Under the AQC model, groups of doctors and hospitals are paid set fees "to work as a team in caring for patients." In the first year of implementation, AQCs resulted in medical cost savings in all participating provider groups, but the incentives that BCBSMA paid to providers are estimated to have made up for the savings. , approximately 613,000 people were covered by BCBSMA under the AQC model (roughly two-thirds of BCBSMA members in

health maintenance organization In the United States, a health maintenance organization (HMO) is a medical insurance group that provides health services for a fixed annual fee. It is an organization that provides or arranges managed care for health insurance, self-funded healt ...

s), but the model had not been applied to policyholders in

preferred provider organization In U.S. health insurance, a preferred provider organization (PPO), sometimes referred to as a participating provider organization or preferred provider option, is a managed care organization of medical doctors, hospitals, and other health ca ...

s. When the company was introducing AQCs to providers, "state lawmakers started talking about payment reform", leading to unexpected interest. Deb Devaux, an executive, said providers also wanted to demonstrate willingness towards

reform Reform ( lat, reformo) means the improvement or amendment of what is wrong, corrupt, unsatisfactory, etc. The use of the word in this way emerges in the late 18th century and is believed to originate from Christopher Wyvill#The Yorkshire Associati ...

. In 2011, the large provider group

Partners HealthCare Mass General Brigham (MGB) is a Boston-based non-profit hospital and physician network that includes Brigham and Women's Hospital (BWH) and Massachusetts General Hospital (MGH), two of the nation's most prestigious teaching institutions. It was f ...

joined the AQC, accepting lower than expected payment levels, possibly preempting regulatory moves to control costs.

Marketing

In March 2018, Blue Cross Blue Shield of Massachusetts announced a six-year marketing deal with Hubway to re-brand the bicycle sharing system and relaunch under the name of "Blue Bikes". Along with the change in name, the bike sharing system will expand with more bikes and branded stations.

References

External links

Official website
{{Authority control American companies established in 1988 Companies based in Boston Financial services companies established in 1988 Health insurance in the United States Insurance companies based in Massachusetts Medical and health organizations based in Massachusetts Members of Blue Cross Blue Shield Association

History

Alternative quality contracts and reform

Marketing

See also

References

External links