Pennsylvania stands out from most states because of the dominance of four Blue Cross Blue Shield plans that operate, for the most part, exclusively in their own territories. Whether the Blue plans’ unique licensing structure is adversely impacting competition statewide is the subject of a probe by the state Insurance Department. Meanwhile, Highmark BC/BS, which controls more than half of the small-group market in western Pennsylvania, is driving a focus on lower-cost generic medications by increasing the price spread between generics and brand-name drugs and emphasizing a closed formulary. In the Medicare market, three of the four Blue plans (except in the Northeast) are gearing up to become part of a national PPO network similar to the BlueCard program, which will better position them against national insurers to offer retirees a portable health plan. It’s not all about Blue, however. Coventry Health Care has come up with an innovative product to transition clients into consumer driven health plans. On the state level, more seniors may be able to get prescription drug subsidies from the state, if legislation passes, but the catch is that pharmacies don’t like the state’s plan for funding the plan. The report also looks at the college student insurance market, including the key players in Pennsylvania.