Regence BlueCross BlueShield Unveils Private Exchange for September Enrollment

Employers that have Regence BlueCross BlueShield coverage have a new option starting in September.

The insurer has decided to offer what it’s calling a private exchange option for select businesses in Oregon, Idaho, Utah and Washington, according to Regence Frieden, spokeswoman for Cambia Health Solutions, the non-profit parent company of Regence.

This decision comes on the heels of Cover Oregon turning over the state’s insurance exchange to the federal government.

From the outset, Regence has never been a fan of Cover Oregon even though it purported to back the exchange during preliminary meetings before its launch date.  

For example, in Oregon, Regence relied on a new product known as BridgeSpan for the individual market, decided not to participate in the SHOP program for small businesses and pulled out of a similar program in Washington state as well.  

Mark Ganz, president and CEO of Cambia Health Solutions, the parent company of Regence, is an avid Republican and has long been opposed to the Affordable Care Act.

“Regence is just trying to game the system and play politics in the hopes that the exchange goes down; it’s quite obvious that they’re setting themselves up to compete by not participating in the exchange and not gamble on a risky population that they can’t predict,” according to people familiar with the marketplace.

The private exchange launched by Regence is being offered as an option to employers, Frieden maintained. It’s likely to be quite successful because mid and large sized employers can drive down their insurance costs by giving each employee a set amount of money each month, giving them the option of choosing from a variety of plan options. Depending on which offering they choose, employees might end up paying much higher out-of-pocket expenses for copayments and deductibles. It’s also uncertain whether dependents will have the same coverage.

Frieden refused to share details on the number of employers that have Regence coverage in the four-state region or share a copy of a white paper, “Defined Contribution: A familiar model redefined for health care,” prepared by Regence executives that explores the emerging trend of defined contributions and its attraction for employers and employees.

In Oregon alone, Regence had 476,439 members in its fully insured health plan on March 31, as well as an unknown number of self-insured employers. It also trailed behind its competitors on Cover Oregon, only signing up 3,654 people on BridgeSpan.

"Employers want simple solutions that control costs while providing top-tier employee benefits," said Jared Short, president of Regence Health Insurance Services. "Regence Marketplace meets these needs through an easy to use online platform that offers an attractive buying alternative to traditional group insurance. Through this evolving model, employers will have new tools to drive employee engagement in their health decisions."

According to Frieden, employers are increasingly turning to private exchange solutions incorporating defined contribution. Consultant Bain & Co. estimates that as many as 80 million people will receive their health insurance through private exchanges by 2018.

While businesses have long been able to choose from a variety of Regence products through the popular Employee Choice program, Frieden added. Regence Marketplace offers the next evolution of employee engagement and flexibility. The online platform provides employers with consumer support tools in one convenient interactive experience, and allows employees to efficiently shop, enroll and manage benefits information.

Diane can be reached at [email protected].

Editor's Note: The subheadline for this article has been corrected to show that Regence is offering a defined contribution plan.