Blue Cross-Blue Shield Office Closing In Palestine : BETTY WATERS
By: Health Insurance
Submitted: 2009-08-17 13:53:12 | Word Count: 954
Having a facility here has been a "positive experience" for Blue Cross-Blue Shield of Texas, but its parent company decided to shut it down as part of a four-state corporate belt-tightening, a spokesperson said Thursday.
Closure of the Blue Cross manual claims document imaging operation in Palestine after nine years of service will be effective Nov. 13 and all 123 current employees will lose their jobs.
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Blue Cross human resources personnel informed Palestine employees during a meeting Wednesday. Meanwhile, a company representative called Bill Lacy, interim director, Palestine Economic Development Corporation, and Lacy in turn notified other community leaders.
"It's always unsettling to have a company close and lose that many jobs," Lacy said in an interview Thursday.
Mayor Bob Herrington said, "I'm disappointed they are leaving; they've been a real asset to our community, so I really hate to see them go."
Overall, the downsizing will cut 183 jobs in Texas alone -- the numbers vary from two in Waco to 123 in Palestine. Other cuts in Texas will be at Blue Cross facilities in Marshall, Richardson, Abilene, San Angelo and Wichita Falls.
Altogether, parent company Health Care Service Corp. of Chicago, will eliminate 650 Blue Cross-Blue Shield jobs over the next four months in Texas, Oklahoma, New Mexico and Illinois to achieve a total savings of approximately $70 million. The staff reduction amounts to about 4 percent of the Blue Cross workforce in the four-state area.
A breakdown by site of the estimated savings was not available Thursday. Only estimates are in hand and it is company policy not to release estimates, according to spokesperson Margaret Jarvis. A solid figure for the savings from closing the Palestine operation will probably be determined after the first quarter following its closure, she said.
The decision to reduce the workforce in Texas, Oklahoma, New Mexico and Illinois came as the parent company started "tightening our belt in order to benefit our customers," Ms. Jarvis said. "In going about this effort, we looked at how we could achieve efficiencies. We looked at realigning our work processes, consolidating resources or automating and using technology more in order to reduce costs."
The manual claims document imaging operation occupies a leased old retail store in the Palestine mall.
"The facility in Palestine was really not like our other full service units across the state because it basically had one main function, and that is manual claims document imaging," Ms. Jarvis said. It extracts certain data from claims needed for other reasons before the claims go on through the system, she explained.
"What we realized was that we could achieve that function more efficiently now using technology and that it was now less productive for us to have an entire unit devoted to this type of manual operation," Ms. Jarvis said.
"It was a difficult staffing decision to close the Palestine facility because we have had such a positive experience living and working in that community, but hopefully it will make the company more competitive and well positioned for future growth," Ms. Jarvis said. "We're very grateful to have been able to have an operation there since 2000."
Blue Cross located in Palestine because the town has a reliable and trainable available workforce and is in a good location, Ms. Jarvis said.
"I think it's been good for us to have the opportunity to have as workforce live and work in the Palestine community," she said.
When the manual claims document imaging operation started, "that was probably the state-of-the-art way to do it, but with advancing technology, that has changed," Ms. Jarvis said.
Blue Cross already has outsourced a portion of it and will be outsourcing the rest in the near future, according to the company official.
Even though the facility will not close until Nov. 13, "Our goal was to be as respectful as possible and give people at the facility advance notice, so that's why we told them this far ahead of time," Ms. Jarvis said.
Employees who continue to work for Blue Cross until Nov. 13 will be given a separation package. It will contain an undisclosed "financial side" as well as outplacement services, such as resources in resume writing, interviewing skills and networking skills.
There will be no transfers to other Blue Cross work sites, although employees can apply at other facilities.
The Palestine Economic Development Corporation will work with other businesses and the Texas Workforce Commission to help Blue Cross employees find other jobs, Lacy said.
The mayor expressed concern that the 123 employees will be terminated just before the holiday season. "I can't help but think of what an emotional and economic impact this will have on all those families. Ultimately, I just hope that once these doors are closed, some new ones open up," Herrington said."
Herrington added, "Our economic development corporation and our chamber of commerce have been aggressively advertising Palestine and answering inquiries from numerous businesses and developers, so hopefully, their efforts are going to pay off and we'll see some new job opportunities in the near future."
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