Blues plans form subsidiary to handle expected boost in individual, small-business claims
■ The move anticipates more insured patients once health reform is in place in 2014. The plans say physicians should notice faster claims processing.
Two BlueCross BlueShield-affiliated insurers have agreed to hand over administration of much of their business to a spinoff subsidiary that will in turn pay a vendor to do the work.
Blue Cross and Blue Shield of North Carolina and Blue Cross and Blue Shield of Kansas City said they are only the "initial" partners in the new company, Topaz, which is to be chartered in Delaware. The physical location of the offices has yet to be determined. (See correction)
The two companies expect other Blues plans to join the "shared savings" plan, under which enrollment, claims and "care management" for individual and small group insurance will be handled by health information technology vendor TriZetto, which has contracted with Topaz.
The individual and small group markets are set to change in 2014, when state-based insurance exchanges launch and an individual insurance mandate takes effect under the Patient Protection and Affordable Care Act.
"Topaz is evidence of how serious we are about continuing to compete and win in North Carolina's rapidly evolving health insurance marketplace," North Carolina Blues President and CEO Brad Wilson said in a statement. "Topaz will accelerate our transformation as a company, bring new capabilities to our customers and fuel our efforts to be a more efficient company."
The business processes for the individual and small group markets will differ from what these plans do now because of the creation of exchanges, said Bill Custer, PhD, professor at the J. Mack Robinson School of Business Institute of Health Administration at Georgia State University in Atlanta.
"The tasks, not just the costs, will be different, and it just makes sense to create a separate entity to handle them," he said.
For physicians, the spinoff business will mean a third party will handle claims for some patients enrolled in the two Blues plans' coverage, beginning in 2014. The plans are hoping physicians only notice changes for the better once the plan becomes a reality.
"While it's still quite early in the partnership, our goal is to improve efficiencies for both providers and our members," said Lew Borman, spokesman for Blue Cross and Blue Shield of North Carolina.
Blue Cross Blue Shield of Kansas City has nearly 1 million members, with about 80,000 individual members and 85,000 people in small group plans, spokeswoman Sue Johnson said. North Carolina's Blues has 3.7 million members and paid more than 48 million claims in 2010. Of those, Topaz will handle about 650,000 customers' claims, Borman said.
TriZetto spokesman Loren Finkelstein said the company will automate much of the claims process to make it faster. It also will allow physicians to log on to a website to check a patient's eligibility, identify how much he or she owes out of pocket, and see important clinical information about his or her care based on insurance claims.
"This just makes life lovely, really, for the physician," he said.
Enrollment in individual and small group plans is expected to grow dramatically across the country, as the federal insurance mandate and health reform expands coverage to more Americans.
Experts expect that more of those newly insured people will buy their own insurance, along with a greater share of workers who once had employer-sponsored coverage. Employer-sponsored coverage has been waning since at least 2008 and was at less than 45% of adults as of the third quarter of 2011, according to Gallup polling.
Finkelstein said some people faced with buying their own coverage will enroll in health insurance plans through state-based exchanges, and TriZetto will handle the enrollment and other administrative parts of that business for the Topaz partners.
He declined to disclose the terms of the Topaz-TriZetto contract, but said it is the first project of its kind for TriZetto.