The Alabama Senate unanimously passed a bill Feb. 17 that would allow the state’s dominant health insurer, Blue Cross Blue Shield of Alabama, to reorganize under a nonprofit holding company, a structure that would let the plan launch new subsidiaries while remaining a nonprofit.
The bill now heads to the Alabama House. If signed into law, it would take effect Oct. 1.
State Sen. Andrew Jones, the sponsor of the bill, confirmed the legislation is aimed at helping BCBS Alabama remain competitive, according to the Alabama Reflector. Alabama has the least competitive commercial health insurance market in the country, with BCBS dominating the market.
Under the bill, BCBS Alabama’s board of directors could authorize the reorganization without prior approval from the state’s insurance department. Once established, the holding company could acquire and invest in other entities, though the bill bars it from acquiring other insurers or providers operating in Alabama.
The legislation follows a wave of reorganizations among BCBS plans nationwide. In recent years, Horizon BCBS of New Jersey, BCBS North Carolina, Blue Cross of Idaho and Blue Shield of California have all restructured under new holding companies, with representatives for several of those plans citing a need to compete with for-profit rivals. BCBS Louisiana also implemented a new corporate structure in 2024 after a proposed acquisition by Elevance Health fell through.
