Blue Shield of California is the latest Blue Cross Blue Shield company restructuring to keep up with the rapidly evolving payer landscape.
In January, the nonprofit insurer launched a new, nonprofit parent company to manage Blue Shield of California's health plan, its clinical services firm, and Stellarus, a new company focused on scaling healthcare solutions.
"Our goal in the restructuring is to better serve our members with less bureaucracy and faster results, while making healthcare more affordable," Kristina Leslie, chair of Blue Shield of California's board of directors said Jan. 8.
The company appointed a new CEO, Lois Quam, to lead its health plan. Paul Markovich, who served as Blue Shield of California CEO for 12 years, was appointed as CEO of its new parent company.
Mr. Markovich was also appointed president of Stellarus. The company will scale Blue Shield's offerings, such as its pharmacy benefit structure, with the goal of making them available to other health plans, according to a Jan. 8 news release.
Other BCBS companies have also restructured in the last few years, with the goal of improving service to members and remaining competitive with for-profit rivals.
In July, BCBS of Louisiana implemented a new corporate structure, after appointing new CEO Bryan Camerlinck to the helm of the nonprofit. The company also appointed four new executives as part of the restructuring, which aimed to "better meet the needs of customers through a renewed focus on simplicity," according to a news release. The move came after a deal for BCBS Louisiana to be acquired by Elevance Health fell through.
Other insurers have reorganized in bids to stay competitive with for-profit rivals like UnitedHealth Group and Aetna.
In 2022, New Jersey regulators approved a proposal from Horizon Blue Cross Blue Shield to reorganize as a nonprofit mutual holding company, which allowed Horizon to acquire for-profit subsidiaries, though the reorganization faced court challenges.
"We must be in a position to compete [with for-profit companies] if we are to continue our mission," Jennifer Velez, senior vice president and general counsel for Horizon, said in 2022.
In 2023, former North Carolina Gov. Roy Cooper signed a bill allowing Blue Cross Blue Shield of North Carolina to reorganize as a nonprofit holding company. Representatives for the company also said the reorganization was necessary to allow it to compete with for-profit insurers.
Blue Cross of Idaho also reorganized as a nonprofit mutual insurance holding company in 2024.