Healthcare Georgia Foundation was created through the conversion of public assets resulting from the merger between BlueCross BlueShield of Georgia and WellPoint Health Networks.
The first BlueCross BlueShield (BCBS) organization was formed in 1937, in Atlanta. Over the next 20 years, multiple BCBS organizations began to surface throughout Georgia with similar missions and operations.
In 1975, these organizations consolidated into two major entities, one based in Columbus and the other in Atlanta. An additional merger in 1985 resulted in what was then known as BlueCross BlueShield of Georgia.
BlueCross BlueShield of Georgia began a six-year journey that would dramatically change the complexion of its management and day-to-day operations. This transition began with the passage of legislation allowing BlueCross BlueShield of Georgia to convert from a nonprofit status to a for-profit status organization. A key provision of the conversion stipulated that a Foundation dedicated to improving the public’s health throughout Georgia be established.
BCBS amended its articles of incorporation and filed a restructuring plan to convert to for profit status. Under that plan, all of the stock would be issued to a newly formed holding company, Cerulean Companies, Inc.
After a hearing in November, the conversion plan was approved by then Insurance Commissioner John Oxendine.
To implement the plan, Cerulean issued stock to 74,000 eligible subscribers.
A coalition of eight nonprofit consumer groups filed a lawsuit in Fulton County against BCBS, Cerulean, and the Georgia Insurance Commissioner John Oxendine. The coalition argued for a transfer of assets to a public trust as part of BCBS’s conversion to for profit status. The coalition was comprised of the following organizations:
Let’s Get Together
Statewide Independent Living Council of Georgia
Living Independence for Everyone
AIDS Survival Project
The Middle Georgia Center for Independent Living
Physicians for a National Health Program
Campaign for a Prosperous Georgia
Friends and Survivors Standing Together
A settlement agreement was entered into, and then filed and accepted by the Fulton County Superior Court, calling for BCBS to establish a healthcare foundation with shares and warrants amounting to an estimated $80 million.
The Foundation, to be called Healthcare Georgia, Inc., adopted as its goal “the advancement of healthcare for all Georgians.” A 9-member initial Board of Directors was also provided for in the settlement. Three initial directors were to be named by the plaintiffs, three by Cerulean, one by the Carter Center, and the remaining two by foundations in Savannah and Atlanta (namely, the Savannah Foundation and The Community Foundation for Greater Atlanta, in consultation with the Nonprofit Resource Center). The Board’s primary role was to approve grants for nonprofit healthcare purposes – healthcare policy analysis, changes in the healthcare systems, and projects to improve healthcare for the uninsured.
- Enoch J. Prow – Chair
- James W. Curran, MD, MPH
- Joseph D. Greene
- Mark Johnson
- Michael F. Kemp, Esq.
- Linda Lowe
- Jerome Scott
- Richard D. Shirk
- Charles Underwood, MD
Simultaneously, BCBS was engaged in active negotiations with California-based WellPoint Health Network, Inc., a NYSE publicly traded company. One day after approval of the settlement, WellPoint acquired BCBS of Georgia for $500 million in WellPoint stock. BlueCross Blue Shield then became an operating company under WellPoint, and holders of Cerulean stock, including Healthcare Georgia Inc., were entitled to receive WellPoint stock when the merger occurred – valued at an estimated $117 million.
The Foundation was created and named Healthcare Georgia, Inc., initially adopting the advancement of healthcare for all Georgians as its goal. The Board’s primary role was to approve grants for nonprofit healthcare purposes – healthcare policy analysis, changes in the healthcare systems and projects to improve healthcare for the uninsured.
The Foundation has been diligently focused on its grantmaking initiatives since the approval and implementation of the BCBS of Georgia and WellPoint Health Networks merger in February 2001.
By the end of the year, Healthcare Georgia was reconstituted and renamed Healthcare Georgia Foundation, Inc. A 9-member volunteer Board of Directors was appointed, bylaws adopted and permanent office space in downtown Atlanta secured.
The Board of Directors recruited and hired a President to manage the Foundation’s endowment and the grantmaking program.
The Foundation launched its first Listening Tour, a series of ten region-based facilitated discussions with professionals working in public health, government, social services and the nonprofit sector.
The Foundation was fully staffed and operational. The grantmaking priorities and guidelines were announced, along with initial implementation scheduled for Fall 2002.
The Foundation faces a bold, exciting, and challenging future, one that embraces a strategic and responsive grantmaking process.
It is hoped that this “story” of our origins and evolution will help to ensure a consistent understanding and interpretation of the past among those involved in the Foundation thus far and those yet to come – be they new Board members, staff, grantees, or other health foundations and organizations. Knowing from “whence we came” can also help offer context for our mission and goals, provide a solid foundation on which to build new endeavors and manage future directions.