Anthem is one of the largest managed care organizations (MCOs) in the US, and the largest for-profit managed care company in the Blue Cross and Blue Shield Association (BCBSA). The BCBSA is a federation of 36 separate US health insurance companies. Anthem offers Medicare, Medicaid and FEHB insurance (government), as well as commercial employer-based insurance to over 40 million members through its BCBSA state subsidiaries. Anthem reports in 4 segments: Commercial & Specialty Business (~30% of revenues), Government Business (~60%), IngenioRx (~8%) and Other (~2%). In addition, Anthem earns investment income on the funds it holds. This is about 1% of its operating revenues but fully flows through to the bottom-line, meaning it's usually 10-15% of EBITDA and almost 20% of net income. Anthem was formed by the 2004 merger of WellPoint and Anthem after both companies acquired several health insurance companies. In 2014, the company was renamed Anthem, to eliminate any confusion for consumers since most of its health plan affiliates carried the Anthem name. Anthem is headquartered in Indianapolis, Indiana, and employs more than 70,000 people.
Anthem has a positive impact on health and wellbeing of US citizens by providing them with access to healthcare, which is still necessary in a country with no universal healthcare coverage. Furthermore, Anthem can play an important role in transitioning the healthcare sector away from fee-for-service models to fee-for-value models, which should lead to more normal levels of healthcare utilisation and thus reduce growth of health care spending. Being the payor, Anthem has to negotiate with healthcare providers about the level of reimbursement and also about how the provider is reimbursed. If Anthem succeeds in convincing hospitals to switch to a fee-for-value model, it should lead to lower and perhaps more predictable medical expenses. This is good for society (taxpayer money can be used for something else), but also good for Anthem as it makes it easier to control its medical expenses and thus maintain (or increase) margins. The provision of health care insurance leads to increased access to health care facilities, improved financial protection and an improved health status. Health insurance plans offer protection against high medical costs which is especially beneficial for low-income groups.