This is wild as it says the contracts have been awarded but the rates are not in place so kind of a strange bid process. When Blue Cross, United, and Health-Net come in, they are not offering blanket coverage and will only offer service in selected areas. This may be a money saving move, but they’ll make it up with additional administration time. Believe me when going from one carrier to a bunch that in itself is enough to create some chaos. Patients may get stuck having to change providers. Blue Cross and Blue Shield are the only two that offer coverage all throughout California I believe and the rest are piece mealed in for certain areas.
Again I don’t know if they have exclusive territories on this as it was not clear if a patient who now lives in a area covered as an example by Health Net would still have the option to also choose Blue Shield or Blue Cross? It was not clear on that end and the article said more information would come out later. They spend $7 billion on healthcare a year. CalPERS said they have no idea if this will result in savings or not themselves, so one might ask, why did you do it? The contracts run for 5 years. At least they were honest about the unknown savings. BD
CalPERS Taking Bids on Health Insurance Contracts, Blue Shield Could Lose a Substantial Amount of Business if Divided Up- Kaiser Permanente Stays
In a bid to curb health care inflation, CalPERS is splitting up its multibillion-dollar HMO contract among five different companies.
The decision Wednesday by CalPERS' governing board ends a quasi-monopoly enjoyed by Blue Shield of California. The company will continue to run CalPERS' HMO plan but will now have to share the business over the next five years with Anthem Blue Cross, Health Net, Sharp and United Health Care.