Top Local Business Stories of the Week


Change coming for state employees’ health plans: A big change is coming to the state’s main health insurance plans that cover nearly a half million current and retired state employees and their dependents.

On Sept. 1, Blue Cross and Blue Shield of Texas will take over administration of the health plans under a new six-year, $281.2 million contract awarded in December by the Employees Retirement System of Texas. Blue Cross and Blue Shield won the contract by underbidding United Healthcare Services Inc., which has administered the plans since 2012.

The Employees Retirement System of Texas provides health insurance for an estimated 440,000 people and is self-funded, meaning it establishes benefits and pays claims. But it uses a third-party administrator to manage a network of medical professionals and process claims.

Under the successful bid from Blue Cross and Blue Shield, the state’s total cost of the health plans is estimated at about $25.8 billion over the six years of the new contract — more than $1 billion less than United’s proposal. The biggest difference is a lower projected reimbursement rate to health care providers in Blue Cross and Blue Shield’s network, according to an analysis of the bids by the ERS.

United’s estimated administrative fee of $325.5 million over the life of the new contract also was higher than Blue Cross and Blue Shield’s projected $281.2 million fee. The contract is for administration of the state’s HealthSelect of Texas and Consumer Directed HealthSelect of Texas plans.

Kathryn Tesar, an ERS spokeswoman, said the agency periodically rebids the contract and determined that the Blue Cross proposal offered better value to the state this time.

“I think from everyone’s perspective (United was) doing a fine job,” Tesar said. “There was nothing wrong with their performance.”

Blue Cross and Blue Shield of Texas, a unit of Chicago-based Health Care Service Corp., has been on the losing end of the rebidding process before. The company has held the state contract off and on for multiple decades and was administering the health plan the last time ERS put it out for bid — when United entered the winning bid.

Blue Cross declined to make a spokesman available for comment but said in a written statement that it has “worked closely over the past nine months to ensure the best possible transition for ERS participants.” United didn’t make a spokesman available for comment.

Kate Johanns, a spokeswoman for the 15,000-member Texas Public Employees Association, agreed with Tesar that United had been doing a good job but said her group backs the state’s effort to keep health costs down through competitive bidding.


Austin’s uShip unveils sleek new HQ, gears up for more growth: After years of working in two downtown offices, employees of Austin-based uShip are finally under the same roof in a sleek new headquarters on East Riverside Drive.

And the timing is right: The move comes as the 220-person company, which runs an online shipping marketplace, shifts into growth mode.

It took two years to convert a former trade school site at 205 E. Riverside Drive into a three-story, 45,000-square-foot showcase. The result is a modern, open collaborative workplace that incorporates both new and repurposed architectural elements with exposed framing and natural light.

“The big thing was to move from multiple offices to one place — that’s what we have been looking forward to,” said uShip CEO Mike Williams. “Being under one roof drives collaboration, and we’re feeling it already.”

The headquarters includes a gourmet kitchen and dining area, where the company has continued its tradition of serving daily lunch, cooked by company chefs. Breakfast is served on Fridays.

Shower facilities, locker rooms and storage areas for bicycles are included. Although there’s enough parking for workers, uShip offers a green credit — $50 per paycheck, or $100 a month — to employees who take public transportation, walk or bike to work.

Dogs are welcome at the new headquarters, and 15 to 20 employees regularly bring them to work, company leaders say.

Outdoor decks and an outdoor seating area offer a view of East Bouldin Creek, while a game area provides a shuffleboard table, a ping pong table, TVs and arcade games.

Founded in 2003, uShip runs an online shipping marketplace that matches customers who need to move unusually big items with thousands of transport companies that can take the loads

Reader Comments ...

Next Up in Business

Whole Foods shareholders OK sale to Amazon
Whole Foods shareholders OK sale to Amazon

Shareholders for Austin-based Whole Foods Market have approved the sale of the company to the e-commerce, Whole Foods executives say. A number of the company’s shareholders gathered Wednesday morning at Whole Foods’ headquarters on Bowie Street in Austin to vote on the $13.7 billion deal, while others voted by mail, telephone...
How Powerball manipulated the odds to make another massive jackpot
How Powerball manipulated the odds to make another massive jackpot

At $700 million, Wednesday night's Powerball prize is the second-largest lottery jackpot in its history, and the math is working out in favor of lotto commissions. Two years ago, your chances of becoming an instant millionaire were 1 in roughly 175 million. Now, the odds are 1 in roughly 292 million. Tweaks to the game in October 2015 increased the...
NW Austin movie theater reopens after massive renovation
NW Austin movie theater reopens after massive renovation

A Northwest Austin movie theater has reopened under new management following a months-long renovation. AMC now operates the nine-screen cineplex at Lakeline Mall, 11200 Lakeline Mall Drive. It was formerly run by Regal Cinemas before closing this year. Upgrades include AMC’s “signature” recliners, an expanded food menu, new audio...
Cedar Park shopping center sells for $112.25 million
Cedar Park shopping center sells for $112.25 million

A Cedar Park shopping center has changed hands in a deal valued at $112.25 million. The Parke, which opened this year at 5001 183A toll road, is a 404,000-square-foot center anchored by the region’s first 365 by Whole Foods Market, Nordstrom Rack, Dick’s Sporting Goods and Field & Stream, among others. PHOTOS: Cedar Park’s 365 by...
Austin lands conference focused on health care innovation
Austin lands conference focused on health care innovation

Local health care industry officials on Tuesday said they have enticed a key conference to move to Austin from Atlanta and expect at least 500 top executives to attend next spring. The third annual Transformation in Health Conference, tentatively scheduled for April or May, relocated to Austin to tap into the region’s entrepreneurial and budding...
More Stories