New England's six Blue Cross and Blue Shield plans have formed an alliance to sell a consistent line of managed-care insurance coverage to regional employers.
The alliance will make available by year-end a commonly defined HMO plan, PPO network and third-party administration plan for self-insured companies, said William Van Faasen, president and chief executive officer of Blue Cross and Blue Shield of Massachusetts.
The coordinated effort would allow employers to contract for the new insurance products in one state and be guaranteed that the surrounding states supply the same terms and services for employees no matter where they work or live. The alliance comprises the Blues plans in Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont.
"Ours is a regional economy. The needs of New England businesses no longer stop or change at state lines, if they ever did," Van Faasen said. "Regional employers don't want to have relationships with 15 or 20 different HMOs."
The alliance will offer one point of contact with the Blues network that will cover all enrollees in a multiple-state reach, avoiding the need to go through several offices for administrative functions such as enrollment and billing, said Andrew Greene, president and CEO of Blue Cross and Blue Shield of Maine.
A number of provider organizations have been extending their geographic range to position themselves for regional business.
For example, Harvard Community Health Plan and Pilgrim Health Care, two HMOs that recently merged, have extended their service area from a Boston-area base into the rest of Massachusetts and portions of four other states where they've affiliated with physician practices and other HMOs (Aug. 22, 1994, p. 15).
And two prestigious multispecialty group practices merged last year into the Lahey Hitchcock Clinic, a three-state network of tertiary and primary care with 52 locations and more than $500 million in annual revenues (Sept. 19, 1994, p. 22).
But in announcing the alliance late last week, the Blues plans said they would be offering the only set of managed-care products covering all of New England.
Van Faasen said each state plan would continue to sell its own tailored insurance products to local employers whose operations are confined to one state. The plans are interested in moving toward greater integration but probably would not go as far as consolidating into one plan because each has to meet different state-level licensing requirements and regulations, he said.