Health Care Service Corp. To Buy Trustmark Health Benefits, Adding To Five-State Blue Cross Portfolio

Blue Cross Blue Shield Tower, home of Health Care Service Corp. and its subsidiary Blue Cross and … [+] Blue Shield of Illinois, on July 09, 2014 in Chicago, Illinois. (Photo By Raymond Boyd/Getty Images)

2014 Raymond Boyd

Health Care Service Corporation, the parent of Blue Cross and Blue Shield health plans in five states, is buying Trustmark Health Benefits, an administrator and designer of employer health benefits, for an undisclosed amount.

The agreement between Health Care Service and Trustco Holdings to buy its wholly owned subsidiary, Trustmark Health Benefits, comes during a period of renewed merger and acquisition activity among health insurers to expand their businesses. In particular, Trustmark, is a “third-party administrator” that will add to Health Care Service’s “capabilities to serve self-funded employers,” the companies said Thursday in an announcing the deal.

“The acquisition will provide HCSC with additional capabilities to serve a broader set of customers seeking customizable and flexible health benefit solutions,” Health Care Service and Trustmark said. The deal is expected to close by the end of this year.

Already, Health Care Service Corp, a mutual health insurance company owned by policyholders, is one of the nation’s largest health insurers and owns Blue Cross and Blue Shield health plans in five states: Illinois, Texas, Oklahoma, New Mexico and Montana. Combined, the health plans have 17 million subscribers across the U.S.

“We are proud to add this asset to our portfolio to continue to meet the diverse and evolving needs of our self-funded customers,” said Dr. Opella Ernest, executive vice president of commercial markets for HCSC. “This arrangement reflects HCSC’s continuous commitment to expand access to affordable, quality health care.”

During a period of full employment with Americans having the ability to change jobs and look for unprecedented opportunities, employers have to be competitive in the health benefits they offer. In Trustmark, Health Care Service is getting a national employee benefits provider known for its “voluntary benefits, fitness management solutions and small-group health plan administration.”

“Today’s employers are facing increasing pressures and challenges,” said Kevin Cassidy, president, national accounts at Health Care Service. “With this acquisition, we’re making it easier for employers of all sizes to have access to our expansive provider networks, our data-driven insights and coordinated approach to care that focuses on quality and value. This isn’t a one-size-fits all world – and we recognize that Health Benefits can help give more customers access to our service strengths.”

Trustmark President and chief executive officer Kevin Slawin said the acquisition will help Health Care Service compete in the “evolving work environment.”

“Trustmark will focus on markets where we can grow in the future, deliver differentiated capabilities for our clients and members and lead at a national level,” Slawin said. “In an evolving work environment, we will accelerate our efforts to become vastly more consequential in the markets we serve by helping employers offer benefits that build engaged, healthy teams.”

Follow me on Twitter or LinkedInCheck out my website or some of my other work here

Life Sciences, Forbes – Healthcare

Free weekly Newsletter

A weekly breakdown of forecasts and trends

Enter your contact info to get The Financial Gambits VIP Newsletter for FREE.

We hate spam as much as you, if you dont like it just unsubscribe and we will never bother you again