The Alan Katz Health Care Reform Blog

Health Care Reform From One Person's Perspective

Blue Cross of California

Posted by Alan on August 8, 2007

First, full disclosure: I was a Senior Vice President at Blue Cross of California, or its parent company WellPoint from September 1997 through November 2005. While my precise responsibilities varied during those eight years, they centered around helping the company grow its Individual and Small Group business. Before joining and since leaving WellPoint, I’ve continued to work with Blue Cross while also having the pleasure of working with its competitors. I greatly respect those carriers, for many of the reasons I respect Blue Cross.

But it’s Blue Cross that has been in the news so much since I started this blog. Yet I’ve purposefully avoided posting on its situation and probably won’t post on it again. It’s too much of a no-win situation for me. If I’m too supportive, then I’m just being defensive. If I’m too harsh, I’m misusing my former insider status.

However, with the Department of Managed Care holding hearings on Blue Cross yesterday, and so many readers knowing of my affiliation with the company, I thought it permissible to make an exception. But this won’t be a post about the the substance of the charges. It’s more personal in nature.

I view the public pilloring of Blue Cross by the Department of Managed Health Care with mixed emotions. I enjoy seeing big companies brought to task as much as the next guy. It’s like watching toothpick thin famous-for-being-celebrity-types doing perp walks. Or watching bombastic politicians busted for the behavior they publicly decry. There’s a karmic aspect of it all that we humans seem to enjoy, the reasurrring balancing of forces in the universe.

So seeing a regulator take Blue Cross to task doesn’t bother me. It’s a part of the process. What prompts me to write, however, is how all this impacts the people of Blue Cross who have accomplished over the years.

The individuals representing the company at the hearing are friends and former colleagues of mine. I’ve seen them at work. Yes, it’s true they paid attention to the bottom line. That’s how any enterprise — for-profit or non-profit — stays in business. But I’ve also seen them striving to do the right thing for their members when no one outside the company was watching. I’ve seen them invest sweat, time and resources to improve customer service. I’ve seen how hard they’ve strived to create new ways of helping those with serious diseases improve their quality of life and medical outcomes. I’ve seen the efforts they’ve made — and the risks they’ve taken — to bring to market products which provide strong coverage at the lowest possible price in the face of skyrocketing health care costs.

Blue Cross is not a perfect company. There are no perfect companies — nor perfect people or government agencies, for that matter. They’ve made mistakes and where those mistakes violate law or regulations they should be appropriately punished. Further, Blue Cross has made their situation worse over the years by sporadically descending into moments of hubris and arrogance — and sometimes just plain public relations mindlessness. They’ve also taken risks to make things better, which means at times, they’ve failed and made things worse.

But Blue Cross of California is no Enron. There aren’t people there conspiring to rip off the innocent. It is a company by and large of people trying to do a good job for their members, their business partners and yes, their shareholders. (Traits they share with most of their competitors and respected companies everywhere).

Few things in life are clear cut. There’s a context and subtlety that gets overlooked in the circus-like atmosphere of a public scolding. Maybe every business and every industry needs to go through this now and again. When done right the results can be positive change. At worse, the hot water may help keep the enterprise humble. It’s just a shame that in the process, the people which make up the company and who are trying to do the right thing, can get scalded along the way.


4 Responses to “Blue Cross of California”

  1. Steve Hausman said


    You are “right on” in your commentary about these public DMHC hearings which I personally attended. I watched and listened as person after person lambasted BCC to the applause of the majority of people in the room (about 300+) as if we were some horrible company whose sole purpose was to rip off the consumer. However, the folks in that room who really got to me and made me feel proud to work for BCC were those who offered their heartfelt thanks and praise to BCC for providing them urgently needed care, saving their lives with very expensive medications, providing healthcare for poor people, healing sick children for little or no premium, and going in to the poorest inner city communities in the state where healthcare is needed the most to provide that care. Our old friend Pat was also there as the agent representing CAR and thanked BCC for picking up the CAR members on a guarantee issue basis after Blue Shield dropped the association and cancelled the program. All in all it was an interesting learning experience for me and I was proud and honored to offer my support. As Bob mentions above, your commentary should be published in the LA Times along with other positive factual commentary from BCC direct. Take good care,


  2. Mike Accetta said


    Well said.

    As you know being a past SVP of Wellpoint / Blue Cross of California, you know how hard the day to day rank and file employee’s care about each other, our members, and the many non-profit organizations that most employees contribute to through their paychecks. This number is in the tens of thousand annually not including company or foundation matches.

    I think the industry, media, agents and our legislators need to know that the everyday working employee’s at Blue Cross of California, some with over 30 years of employment with the company, really do care and reach out in time of need. I won’t go into detail, but I could share countless good news stories on positive outcomes for our members that I have personally been involved in.

    It would be a shame to see long-term harm done to the organization and it’s employee’s through mis-guided healthcare reform that would put thousands of us in the unemployment lines.

    Mike Accetta

  3. Jim D Loving said

    Hello Alan. Thank you for defending the hard working people of Blue Cross of California who daily are working to serve the members who have entrusted their economic health care to them.

  4. Bob Ceasar said

    Hello Alan. Well said. It would be great of some of the newspapers, such as the LA Times would publish this.
    Bob Ceasar

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