Dive Brief:

• Cambia Health Solutions’ affiliation with Arkansas Blue Cross and Blue Shield has been greenlit by Arkansas regulators, clearing the way for the deal to close this fall, according to a Friday press release from the companies.
• The affiliation appears similar to an acquisition, though no assets are changing hands, according to a Cambia spokesperson. Under the partnership, both Cambia and Arkansas Blue Cross will maintain their local plan names and leadership, but will unify their operations under Cambia, giving the Blues plan access to Cambia’s technology.
• The deal marks the sixth affiliation with a Blues plan for Cambia, a nonprofit healthcare and technology company that operates Regence Blues plans in Idaho, Oregon, Utah and Washington, along with Blue Cross Blue Shield of North Dakota. The Arkansas affiliation is set to take effect Oct. 1.

Dive Insight:

Regional health plans have been looking for new ways to stay operational, swamped by elevated medical spending, burdensome regulatory overhead and competition from national carriers. The tricky environment has affected some of the longest operating insurers, including Providence Health Plan. The insurer has been in business for more than 40 years, but is shutting down next year after failing to find a partner to keep some of its insurance lines afloat.

Arkansas Blue Cross — the largest insurer in the Natural State, serving members for nearly eight decades — is likely trying to avoid a similar fate through its new affiliation with Cambia. The deal will combine the two companies’ investments and administrative functions to boost their finances, while enabling them to develop new technology and care management services, according to the release.

“Our commitment to Arkansas remains unchanged. By combining local expertise, trusted relationships, innovation and scale, we can strengthen our impact, better serve our customers and position ourselves for a strong future,” Curtis Barnett, the CEO and president of Arkansas Blue Cross, said in a statement.

Under the affiliation, Arkansas Blue Cross will maintain its local plan name, board of directors, philanthropic foundation and nonprofit status, and keep all of its reserve funds and foundation resources. Barnett will remain CEO of the plan, according to the spokesperson.

Meanwhile, Cambia’s membership is expected to grow from about 4 million people to nearly 6 million after the affiliation is closed, the spokesperson said.

Cambia emerged from the rebrand of Regence Blue Cross Blue Shield’s parent company in the early 2010s. The company has grown to own or invest in more than 20 companies, including Asuris Northwest Health, a nonprofit insurer primarily in eastern Washington, and BridgeSpan Health, an Affordable Care Act insurer in the Pacific Northwest.

Cambia had also planned an affiliation with Blue Cross Blue Shield of North Carolina in 2019, but backed out of the agreement after the insurer’s CEO was charged with driving under the influence.