Blue Cross / Blue Shield

The Challenge
Blue Cross/Blue Shield of New Mexico is owned by the HCSC Corp. of Chicago, which is the parent company for Blue Cross of Illinois, Texas and New Mexico. As BC/BS has expanded its service area, it has created regional claims processing centers in other states similar to the requirement for New Mexico. In the summer of 2001, our team was retained by HCSC to assist in a real estate/occupancy search for this requirement in Albuquerque and began to actively pursue economic incentives from both the City and the State to better position this requirement for New Mexico.

The Solution
After identifying 11 suitable locations for evaluation, we conducted a series of meetings with the City and State to put together a viable incentive package. The real estate component was solved with a 10 year lease on a 104,000 square foot former Home Base retail operation. An aggressive lease rate was negotiated by the team to allow the client to fund its own interior improvements to the space within the parameters of the overall budget. On a simultaneous track, the team worked with the City of Albuquerque to fund approximately $40,000 in utility upgrades to the site. The process for in-plant training dollars with the State was a much longer process and required the approval of several committees of the State Legislature plus the approval of the Governor. Final State approvals were completed in February 2002 with the client receiving $575,000 from the “in-plant” training program for the first round of approximately 125 new hires to staff the new facility. Because the initial application has been approved with State, the client qualifies for additional funding as additional phases are hired and should receive two additional rounds of funding for approximately $500,000 each for the next two hirings. Lease signing was completed within 48 hours of the initial funding approval by the State. The Team was involved with the client’s consultants and contractors in coordinating approximately $5.5 million of interior improvements to convert the former retail space to a full-service, claims processing center. The facility was completed and ready for operations in August 2002 which was immediately staffed by the first group. This facility has provided over 450 new jobs to New Mexico.

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