The Blue Cross and Blue Shield Association is the national trade organization that associates 38 independent regional health insurance companies in the United States and Canada. It was formed in the 1982 fusion of the Blue Cross Association and the National Association of Blue Shield Plans that are founded basically in Chicago, Illinois. Both organizations trace their histories to health plans that were created around the same time in two different parts of the U.S. The progression of managed health care in the United States is closely linked to the designs of Blue Cross-Blue Shield.

Blue Cross and Blue Shield Plans are presenting Medicare Advantage and Medicare Prescription Drug Plans in local markets across the country. Blue Cross and Blue Cross of California are being scrutinized by California regulators after 10 lawsuits were filed against Blue Cross in March 2006 claiming that the company had not acted in a good loyalty to thwart fraud and it also had a special department specifically set up to methodically look for any justification to reject coverage for large claims.

When the company issues a medical insurance policy, the person insured thinks he or she has medical coverage and relies on it and the person can find out other coverage if the company has a legitimate reason for denying coverage and tells the person at the time of the insurance application. If the insurance company doesn’t review applications until claims are filed and then retroactively cancels the policies, the people insured by the company find themselves without insurance and prone for all the medical expenses they thought were covered by their medical insurance. This is a very serious injury caused by the insurance company’s bad faith failure to assess the application in a timely manner.

Blue Cross offers the Healthy Families Programme in all 58 California counties, as a Health Management Organization (HMO) product in 11 counties and as an Exclusive Provider Organization (EPO) product in the remainder of counties. Blue Cross of California is the largest health coverage provider with more than 125.000 members, nearly 40 percent of the total programme membership and it has approximately 323.000 children contributing in the Healthy Families Programme statewide.

Blue Cross of California, with 5.4 million medical members, is the California operating auxiliary of Well Point Health Networks Inc. Well Point serves the health care needs of more than 7.6 million medical and approximately 34 million specialty members nationally. Well Point offers a broad spectrum of quality network-based health products including open access PPO, POS and hybrid products, and HMO and specialty products. Specialty products include dental, vision, mental health, life and disability insurance, long term care insurance, pharmacy benefit management, utilization management, flexible spending accounts, COBRA administration, and Medicare supplements.