Premera to invest $50 million in health initiatives in Alaska

Health insurer Premera Blue Cross Blue Shield of Alaska is planning a multimillion-dollar investment into Alaska’s mental health and rural health care service.


Premera is the sole insurer remaining on the state’s individual health insurance market and covers about 20,000 people in Alaska’s market. On Monday, the company announced plans to invest $50 million over the next five years to support stability in the individual insurance market, provide more access to care in rural areas and work with communities to improve behavioral health treatment.

The company is still working on specifics for what exactly those plans look like on the ground, said Steve Kipp, vice president of corporate communications for Premera.

“We wanted to put a stake in the ground and say that these are areas which we are going to be committed to invest in,” he said. “…This is over a four to five year period, and this is the very beginning of the process. We have a lot of time on how we’re going to invest in the community and invest in areas.”

The $50 million is a one-time reimbursement to the company as a result of the federal Tax Cuts and Jobs Act, passed by the U.S. Congress in December 2017, according to an announcement from the company. One provision of the act was for the federal government to return some prior tax payments to eligible companies over a four-year period. Under the previous tax code, health insurers had been required to pay federal taxes since the Tax Reform Act of 1986.

“This unexpected tax refund is an opportunity for us to look beyond our own business needs and address critical issues in the communities where we live and work,” said Jim Grazko, President and General Manager of Premera’s Alaska office, in the news release.

Part of that refund, about $1.5 million, will go back to large group customers in 2018. It may also include some returns to smaller group and individual customers in the future, Kipp said.

Some of the ideas the company has to improve rural health care access include initiatives to attract and support health care providers in rural areas and enhance telemedicine and telepsychiatry programs, which allow remote delivery of health care services from providers in more urban locations. The company plans to work with the state and experts on how to executive that, Kipp said.

The company made a commitment to improving behavioral health about a year ago, and the announcement includes $8 million in funding over five years to better support that. Homelessness is a major focus for the program, Kipp said.

“You look at mental health issues, childhood trauma, addiction, it all kind of rolls into the homelessness issues,” he said. “We committed $8 million over five years to address that. We’re actively working with organizations up in Alaska (on it).”

The state also recently applied for a federal Medicaid waiver to begin a comprehensive plan to provide specialized services for children, teens and adults with mental health, substance abuse and behavioral health issues in the state. The program specifically targets those patients on Medicaid and aims to provide better health outcomes over the long-term, thus avoiding the cost of acute care services, by providing more preventative services.

Though Premera’s initiative is separate from that, the company works with the state and will continue to do so, Kipp said.

“We fully intend to keep working with them on all these issues,” he said. “We would be working with them as well as with other nonprofits and organizations.”

The $50 million investment is separate from the $25 million reimbursement Premera returned to the state reinsurance program in December, which resulted from fewer claims being filed over the course of the year and the company’s costs coming in under expectations.

The Alaska Department of Commerce, Community and Economic Development’s Division of Insurance, which oversees the individual marketplace health insurers, said the individual market has stabilized since the implementation of the reinsurance program, helping to buffer the double-digit percentage increases in premiums Alaskans saw for years.

“This is welcome news for Alaskans who endure some of the highest health insurance costs in the nation,” said Lori Wing-Heier, director of the Division of Insurance, in a news release issued Monday. “We look forward to learning more details about the premium rebates for individual and small group customers and the tax refunds that will be returned to large group customers.”

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