BlueCross has $1.6 billion economic impact on Tennessee

Tennessee's biggest health insurer is helping to insure both the physical health of the state's residents and the fiscal health of Tennessee's economy, especially in its hometown of Chattanooga, a new study shows.

By having its corporate headquarters and regional offices within the state, BlueCross BlueShield of Tennessee brought in an estimated $1.6 billion in income and $367.9 million in tax revenue to Tennessee's economy, according to an economic impact analysis of the company released today.

photo Dr. Bill Fox, director of the University of Tennessee Center for Business and Economic Research, answers questions during the State Funding Board meeting on Wednesday, Nov. 30, 2005, in Nashville, Tenn. (AP Photo/Mark Humphrey)

Blues generate green for Tennessee

› $1,596 billion income generated› $367.9 million tax revenue generated› 18,043 jobs generatedSource: Boyd Center for Business and Economic Research, University of Tennessee

BlueCross employment & payroll

› Chattanooga, 5,003 jobs with $475.5 million payroll› Nashville, 489 jobs with $53.4 million payroll› Memphis, 324 jobs with $29.1 million payroll› Knoxville, 112 jobs with $11.2 million payroll› Tri-cities, 94 jobs with $9.3 million payroll› Jackson, 60 jobs with $9.3 million payroll

The Boyd Center for Business and Economic Research at the University of Tennessee estimates that in 2017 the Chattanooga-based BlueCross plan generated 18,043 direct and indirect jobs in Tennessee through its own staff and related jobs generated by its activities.

With more than 5,000 of its employees at its Chattanooga headquarters, BlueCross is one of the top employers in Hamilton County, behind only Erlanger Health System and the Hamilton County school system. The $476.5 million annual payroll by BlueCross in Chattanooga helps support thousands of other jobs, according to UT economists who conducted the economic impact study.

"What we measured was the economic value to Tennessee of having a corporate headquarters in the state, combined with a number of regional offices across Tennessee, and this study shows the significant contribution that BlueCross makes to the state's economy by being based here," said Dr. Bill Fox, director of the Boyd Center for Business and Economic Research. "That is different from a business that might offer health insurance in Tennessee but may be operating from some other part of the country where all of those headquarter functions are done."

Although BlueCross in Tennessee is a not-for-profit company, the Chattanooga-based health insurer is taxed the same as investor-owned health insurance companies. With Tennessee's premium tax on nearly all insurance revenues, BlueCross regularly pays more in state and local taxes than it earns in net income, not even including the federal taxes paid by BlueCross.

The BlueCross Tennessee plan, which has been in operation since 1945, is one of 36 separate Blue Cross organizations in the United States. In 2017, the company served 3.4 million members and more than 11,000 companies.

Most of BlueCross's revenues are collected from Tennesseans, but a bigger share of that money stays within the state compared with health insurers headquartered or processing claims outside of Tennessee, Fox said.

Fox said the economic gains calculated in the study also do not include some of the charitable, volunteer and community leadership provided by the company. BlueCross donated $10.7 million in charitable giving and its employees donated more than 8,00 hours to local communities last year.

"We measured only the direct dollar benefits, although there are clearly a lot of other indirect benefits of having the talent of a company like BlueCross headquartered in your city," Fox said.

Roy Vaughn, a senior vice president at BlueCross and a former chairman of the Chattanooga Area Chamber of Commerce, said BlueCross commissioned a similar economic impact study in 2006 and the estimated value of the company's economic benefits has doubled in the past decade.

"We take pride in not only serving our members in Tennessee, but also being a major employer and, as this study demonstrates, a major contributor to the economy of our state," Vaughn said.

The biggest share of BlueCross's staff is housed in the company's $300 million corporate headquarters the insurer built on Cameron Hill in downtown Chattanooga nearly a decade ago. But among BlueCross's more than 6,000 employees, nearly 1,700 are teleworkers and work primarily from their homes.

The company employs hundreds of nurses and other health care professionals, along with IT specialists and corporate managers at its Chattanooga facility, where the average salary for full-time workers is $53,416.

"Tennessee is a special place we've been honored to call home as a company for more than 70 years and that's something that helps to set us apart as a health plan," said John Giblin, BlueCross' executive vice president and chief financial officer. "With our people and operations right here, we're proud that better health also extends to the state in the form of strong economic impact."

Contact Dave Flessner at or at 757-6340

Upcoming Events