(Bloomberg) — A group of 16 U.S. Blue Cross insurers, including WellPoint Inc. (NYSE:WLP), is joining with the U.K.’s Bupa to create the world’s biggest provider network for international health-insurance customers, the companies said.
The Blue Cross and Blue Shield Association will form a combined provider network with Bupa, the U.K.’s largest private medical insurer, that will include more than 11,500 hospitals in more than 190 countries, the partners said in a statement.
Closely held Bupa will also purchase a 49 percent stake in Highway to Health Inc., a company owned by the Blue Cross plans that sells global insurance products. Terms weren’t disclosed.
The partnership may help Blue Cross insurers like WellPoint better compete with UnitedHealth Group Inc. (NYSE:UNH) and Cigna Corp. (NYSE:CI) – companies that have been growing business outside the United States. The partnership will initially focus on benefits for expatriate workers and look to expand its offerings later on.
“We are going to be able to provide expatriates with the best solution to access health care around the world, and this will also benefit large employers who have employees who travel abroad for long periods,” said Robert Elfinger, a spokesman for the Chicago-based Blue Cross Association, in a telephone interview. In Blue Cross and Blue Shield, the venture has “a brand everybody knows and Americans trust.”
The companies weren’t releasing terms of the purchase by London-based Bupa, Elfinger said, and he declined to estimate possible future membership, sales or profitability.
Global corporate travel and international assignments are expected to increase 50 percent by 2020, according to Elfinger, who cited a 2010 PricewaterhouseCoopers LLP study. Assignments had already risen 25 percent in the decade before that, the report found.
Bupa has 800,000 members in its international health plans, while Blue Cross international policies serve about 25,000 members currently, Lang said. The American companies have potential to expand, given their policies cover 100 million people in individual and employer plans, he said.
–With assistance from Andrea Gerlin in London. Editors: Reg Gale, Phil Serafino