Blue Cross Blue Shield Louisiana (BCBSLA) announced that it will not move forward with plans to be acquired by Elevance Health.
“We continue to hear from our stakeholders that they want Blue Cross and Blue Shield of Louisiana to remain their trusted partner in their healthcare journey, and we pursued this transaction to help us do exactly that – by changing for the better. However, it is clear that our stakeholders need more time and information to understand the benefits of the changes we have proposed,” a letter from the payer explained.
The payer called off its policyholder proxy and vote process and a related meeting.
Importantly, the plan’s language was not final. It said that it had decided to “pause” its process with Elevance Health.
“We continue to believe we need a strong partner to help position us for a vibrant future, and to help us make healthcare more affordable and to help us do more to improve the health of members and policyholders. However, now is not the right time to make this bold step,” the letter from BCBSLA read.
The planned acquisition has been paused and revived previously.
Elevance Health and BCBSLA initially announced the acquisition in January 2023, after six years of partnership in other capacities.
According to the payers, the acquisition would lead to joint ownership of Healthy Blue, which serves dual eligibles and increased access to Carelon’s behavioral healthcare services among BCBSLA members. It would also kickstart the Accelerate Louisiana Initiative, a $3 billion effort to improve health equity.
According to an FAQ for BCBSLA members, Elevance planned to pay $2.5 billion to purchase the health plan and the deal would have closed in the fourth quarter of 2023.
However, the plans came under scrutiny. The Assistant Attorney General from the US Department of Justice (DOJ) Antitrust Division called on the Louisiana Department of Insurance to assess the merger’s competitive effects on the insurance market and adjacent markets, like the healthcare workforce labor market. State lawmakers also discouraged the attempt.
Under pressure from state regulators, the payers paused the deal in September 2023. However, they reignited in December 2023 when BCBSLA re-submitted its reorganization plan, which would allow it to become a for-profit entity. On February 14, 2024, BCBSLA withdrew its transaction.
“There are serious questions that require answers to provide protections and safeguards for Louisiana ratepayers and providers,” Louisiana Insurance Commissioner Tim Temple commented in a statement on the matter.