BIG CHANGE FOR STATE WORK­ERS’ IN­SUR­ANCE

As of Sept. 1, health care to be pro­vided by Blue Cross, which won bid.

Austin American-Statesman - - FRONT PAGE - By Bob Sech­ler bsech­ler@states­man.com

A big change is com­ing to the state’s main health in­sur­ance plans that cover nearly a half mil­lion cur­rent and re­tired state em­ploy­ees and their de­pen­dents.

On Sept. 1, Blue Cross and Blue Shield of Texas will take over ad­min­is­tra­tion of the health plans un­der a new six-year, $281.2 mil­lion con­tract awarded in De­cem­ber by the Em­ploy­ees Re­tire­ment Sys­tem of Texas. Blue Cross and Blue Shield won the con­tract by un­der­bid­ding United Health­care Ser­vices Inc., which has ad­min­is­tered the plans since 2012.

The Em­ploy­ees Re­tire­ment Sys­tem of Texas pro­vides health in­sur­ance for an es­ti­mated 440,000 peo­ple and is self-funded, mean­ing it es­tab­lishes ben­e­fits and pays claims. But it uses a third­party ad­min­is­tra­tor to man­age a net­work of med­i­cal pro­fes­sion­als and process claims.

Un­der the suc­cess­ful bid from Blue Cross and Blue Shield, the state’s total cost of the health plans is es­ti­mated at about $25.8 bil­lion over the six years of the new con­tract — more than $1 bil­lion less than United’s pro­posal. The big­gest dif­fer­ence is a lower pro­jected re­im­burse­ment rate to health-care providers in Blue Cross and Blue Shield’s net­work,

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