Elevance Health, Inc.

Company information

• Date founded: 2004
• Industry: Managed Health Insurance
• Corporate headquarters: Indianapolis, Indiana, United States
• Type: Public

Overview

Elevance Health, Inc., formerly known as Anthem and Wellpoint, is an American-managed healthcare insurance company. It is the largest for-profit managed care entity in the Blue Cross Blue Shield Association network. Although its history dates back to the 1940s, Anthem, Inc. was the result of a 2004 merger between the Indianapolis-based Anthem company and WellPoint, a California-based insurance company. Known for a time as WellPoint, the merged company resumed the use of the Anthem name in 2014. By the second decade of the twenty-first century, it was providing managed health insurance coverage for more than forty million members across two dozen states. Following a 2022 merger, the company took on its new parent company's name, becoming Elevance Health, Inc.

History

The company, known as of 2022 as Elevance Health, was known for much of the early twenty-first century as Anthem, Inc. This company originated as two companies established in Indiana in the 1940s. Mutual Hospital Insurance Inc. and Mutual Medical Insurance Inc. were formed in 1946 in Indianapolis, and within three decades, more than three-quarters of the population of Indiana had insurance provided by these companies. Over time, they became known as Blue Cross of Indiana and Blue Shield of Indiana, respectively. Blue Cross plans provide coverage for medical services associated with hospitals, while Blue Shield plans cover doctor’s visits and similar physician services.

In 1972, the Blue Cross and Blue Shield plans of Indiana merged to become a single entity. They became known as Associated Insurance Companies, Inc., but instead of this corporate name, the company was more commonly known as Anthem. Associated Insurance Companies began acquiring insurance companies in various other states, including Ohio and Kentucky. By 1995, after acquiring plans with nearly two million members in Ohio, the company was officially established as Anthem Blue Cross and Blue Shield.

Meanwhile, Blue Cross of Northern California and Blue Cross of Southern California merged in 1982 to become Blue Cross of California. The northern and southern companies date back to the 1930s. In the late 1980s and early 1990s, the trend in health insurance was moving towards managed care. Managed care plans seek to coordinate care through a primary care physician chosen by each patient. That physician oversees all aspects of the patient’s care, referring them to specialists for additional testing and treatment as needed. The aim of this model is to control costs by reducing repetitive testing and procedures while also improving outcomes for the patient. In 1992, Blue Cross of California established WellPoint as its managed care division.

The following year, WellPoint Health Networks Inc. became a separate entity. Three years later, when Blue Cross of California restructured to for-profit status, it reorganized and made WellPoint Health Networks the parent organization for the entire enterprise. Over the next several years, WellPoint acquired healthcare plans and other associated businesses, such as mail order pharmacy services and dental and vision insurance providers. These acquisitions expanded its reach into Michigan, Texas, Ohio, Georgia, Wisconsin, and other states.

In November 2004, WellPoint Health Networks merged with Anthem Insurance Company. Anthem became the parent company but adopted the WellPoint, Inc. name. It continued to use Anthem as a brand name for specific product lines in some of the eleven states in which it was doing business at the time.

As of the early 2020s, Anthem Inc. offered health insurance and related services in fourteen states through an arrangement with the Blue Cross Blue Shield Association and other insurance entities. The fourteen states are California, Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, New York, Ohio, Virginia, and Wisconsin. In addition to managed care plans, Anthem also offered PPOs, or preferred provider organizations, that used a network of approved plan providers. Customers received greater cost coverage for services provided by plan providers and paid more for those from out-of-network providers who were not part of the approved list. Anthem also provided hybrid plans that were a combination of managed and non-managed care, as well as vision and dental coverage insurance.

Elevance Health’s 2022 stated purpose was to improve the health of humanity, transform healthcare, and become a partner with physicians and patients in providing quality care. Its annual revenues were reported to be about $156 billion. The company employed more than one hundred thousand people across all of its nearly six hundred subsidiaries and locations, with its headquarters in Indianapolis, Indiana. It provided coverage to people in the fourteen states as well as several neighboring states. This brought the number of people covered by Anthem to more than forty-seven million individuals in more than two dozen states.

Impact

Elevance Health’s impact on health and the health insurance marketplace in the United States has been significant. The company is a powerful lobbyist that impacts government decisions on health-related matters. The company was an outspoken opponent of the 2010 Patient Protection and Affordable Care Act, also known as Obama Care. Despite its opposition, the measure passed and provided a marketplace where people without employer-sponsored insurance plans could purchase individual health plans with government subsidies. The act also established some requirements for what all health insurance plans had to cover at no or low costs, such as annual physicals and related preventative care.

Elevance Health has also impacted healthcare-related legislative acts. It provided financial resources to lobby either for or against several key plans in Colorado and California between 2006 and 2016. It opposed a 2006 California act related to public funding of political campaigns and a 2014 initiative in the same state addressing public notification of health insurance rate increases. Also in 2014, Anthem supported a California proposal to help prevent veteran homelessness. In 2016, Elevance Health, then Anthem Inc., opposed the ColoradoCare System. In each case, the measures it supported passed, and those it lobbied against failed.

During the 2010s, the company joined a growing initiative to provide doula coverage as part of its maternity services. A doula is a professional hired to assist a woman through pregnancy, birth, and the period immediately following birth. They generally undergo special training but are not medical personnel. Instead, they act as assistants and advocates during the prenatal, labor, and post labor periods.

In March 2022, Anthem announced another significant rebranding effort. At the center of the rebranding was the name change to Elevance Health, Inc. It was announced the name change would more accurately reflect the company’s focus on elevating its services beyond healthcare to supporting total health for its members and communities. The rebranding did not touch the Anthem Blue Cross and Blue Shield product lines but streamlined several other subsidiaries with the intent of improving care and the customer experience.

The company has been at the center of numerous controversies or legal challenges throughout the years. It has been accused of not fulfilling promises to provide $30 million to help fund care for the uninsured in 2007. Elevance Health also faced legal challenges related to canceling policies for members with conditions that were costly to treat, including breast cancer, as well as the policies of customers who paid with credit cards. The company agreed to settlements in some of these cases without admitting any guilt.

In 2010, the company was investigated after it raised individual coverage premiums for some California members by nearly 40 percent just one year after raising them 68 percent. Following the investigation, the company agreed to postpone the second rate hike. The company has also been accused of misclassifying expenses to gain higher reimbursement from government funding programs such as Medicaid (for low-income individuals) and Medicare (for those over sixty-five and those with disabilities). Elevance Health subsidiaries have also been criticized for refusing payment for emergency room visits related to diagnoses they do not cover, even though the member would have no way of knowing their diagnosis in advance.

In addition, Elevance Health has been in the news because of two significant data breaches, one in 2009–2010 and one in 2015. The first happened when a third-party vendor did not restore all the appropriate security measures after some routine system maintenance. The personal information of more than 230,000 people under the age of sixty-five was left exposed for several months. During the second breach, the personal data of more than 37.5 million members of multiple Elevance Health subsidiaries was potentially exposed by the actions of hackers. The company agreed to pay $115 million towards identity theft services for its affected members. Two Chinese nationals were arrested in connection with the 2015 breach.

In 2015, Elevance Health attempted to acquire the Cigna insurance company. The acquisition, which would have cost Anthem $54 billion in cash and assets, became controversial. Critics feared it would reduce competition and increase healthcare costs. The proposal became an issue in the 2016 presidential election and was ultimately stopped by the actions of a federal judge in 2017.

In late 2024, Elevance Health announced a lawsuit against the US Department of Health and Human Services (HHS) over its 3.5-star Medicare Advantage star rating, calling the rating system arbitrary and capricious. Elevance also claimed that the methodology used to determine the ratings was inadequate and inconsistent, leading to unfair scores. The company estimated the ratings would cost them at least $375 million in bonuses and rebates.

Bibliography

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“Anthem to Pay Nearly $40 Million to Settle Data Breach Probe by U.S. States.” Reuters, 30 Sept. 2020, www.reuters.com/article/us-anthem-cyber/anthem-to-pay-nearly-40-million-to-settle-data-breach-probe-by-u-s-states-idUSKBN26L2PW. Accessed 3 Feb. 2025.

Chou, Shih-Chuan (Andrew), and Jeremiah D. Schuur. “Beware This Insurer’s Sneak Attack on Emergency Care Coverage.” Stat, 9 Mar. 2018, www.statnews.com/2018/03/09/anthem-insurance-emergency-care. Accessed 3 Feb. 2025.

Olsen, Emily. "Elevance Health Sues HHS over Medicare Advantage Star Ratings." Healthcare Dive, 4 Nov. 2024, www.healthcaredive.com/news/elevance-sues-hhs-cms-medicare-advantage-star-ratings/731873. Accessed 3 Feb. 2025.

"Who We Are." Elevance Health, www.elevancehealth.com/who-we-are. Accessed 3 Feb. 2025.