Following other Blues around the country, Independence Blue Cross is redesigning its corporate structure in pursuit of flexibility.
The Philadelphia-based insurer, whose affiliates and subsidiaries operate in 22 states and Washington D.C., recently filed a restructuring plan with the Pennsylvania Insurance Department.
In large part, the restructuring is aimed at simplifying the company's regulatory requirements and putting it on equal footing with competitors, CEO Daniel Hilferty said in a media release.
"We're redesigning a 75-year-old structure that reflects our past, not our present or our future," said Hilferty, who became CEO in 2010 and joined the company after leading AmeriHealth Mercy, a joint subsidiary of Independence and Blue Cross and Blue Shield of Michigan.
"We will gain the flexibility we need to continue boldly leading the transformation of healthcare in our region and the nation," Hilferty said.
Under the proposed structure, Independence would remain a nonprofit, tax-paying corporation (it paid some paid more than $250 million in federal, state, and local nonpayroll taxes in 2012), with the nonprofit holding company retaining the Independence name.
A second holding company using the AmeriHealth name would be structured as for-profit, and would contain existing subsidiaries and affiliates -- among them QCC Insurance Company, NaviNet, CompServices and several AmeriHealth companies -- categorized into four sub-holding companies based on geography and products.
"Beyond giving IBC increased flexibility, speed, and efficiency, little else would change because of the proposed redesign of its corporate structure," the company said in a media release.
Nationwide, Independence companies insure about four million people and offer pharmacy and other benefits to another three million. The company started out as a hospital plan in 1938, became Blue Cross of Greater Philadelphia in 1964 and switched to its current name in 1988, today insuring about 2 million Pennsylvanians in the five counties surrounding Philadelphia
The Pennsylvania Insurance Department now needs to review the plan, and it's also open to public comment.
"Our team will now begin its rigorous review to evaluate this transaction against the standards in state law," Pennsylvania Insurance Commissioner Mike Consedine said in a media release. "We will focus on licensure, solvency, business plans and management, as well as the impact the transaction could have on competition and consumers."