Close Close
ThinkAdvisor
A house in the mountains of Vermont

Life Health > Health Insurance

Michigan Blue to Acquire Vermont Blue

By Allison Bell

X
Your article was successfully shared with the contacts you provided.

Two nonprofit Blue Cross and Blue Shield carriers are planning to team up.

Blue Cross and Blue Shield of Michigan Mutual Insurance Company has agreed to acquire Blue Cross and Blue Shield of Vermont through an affiliation arrangement, the carriers announced Monday.

The agreement would involve no exchange of cash, the carriers said.

What It Means

Clients with health coverage in Vermont may end up in health plans with new features.

The Carriers

Michigan Blue is a Detroit-based organization that was founded in 1939 and now has 5.2 million enrollees.

The company lost $374 million in 2021 on $32 billion in revenue, according to the company’s annual report.

Vermont Blue is a Berlin, Vermont-based carrier with about 230,000 enrollees. It was founded in 1944 as part of Blue Cross and Blue Shield of Vermont and New Hampshire. It split off from the New Hampshire plan in 1981.

Vermont Blue reported $13 million in net income for 2020 on $480 million in revenue.

Vermont Blue provides coverage for 57% of Vermont residents with individual coverage and 60% of the residents with small group coverage, according to the Kaiser Family Foundation.

The Deal

Don George, Vermont Blue’s CEO, said in a blog that the organization needs the affiliation deal to improve its technology and keep its coverage affordable.

The affiliation agreement is subject to approval from state regulators.

Vermont Blue would keep its employees, its executives, its offices and its board.

“Premiums generated from each health plan will stay in the respective states and will wholly be used to pay claims, administer plan operations and maintain member reserves,” the carriers said. “Each organization will continue to operate financially as a single state plan.”

(Photo: AJ13/Shutterstock)

Allison Bell

Think_Allison

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.