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April 26, 2023

Premera Blue Cross auto-scales operations on demand by migrating to Azure Kubernetes Service, reducing costs by up to 60 percent

Premera Blue Cross (Premera), a health plan based in the Pacific Northwest, chose Azure Kubernetes Service (AKS) to save time and money, freeing up staff to focus on improving services for its members. The organization had migrated to Microsoft Azure, but it found that significant time and effort were required to manage its previous Kubernetes service. Premera needed a stable, secure environment to support rapid growth. The organization realized that it could lower costs and liberate staff from maintenance work by using AKS. With AKS, Premera reduced the total cost of ownership by up to 60 percent and freed up a team of 10 people.

Premera Blue Cross

Premera Blue Cross (Premera), a health plan based in the Pacific Northwest, has a mission of making healthcare work better for its more than 2.75 million members, and its IT organization wanted to become more agile to achieve that goal. Premera was devoting significant time and money to managing its Kubernetes platform. As the organization’s business grew, it was clear that a fully managed solution would be a better use of resources. The team started exploring Azure Kubernetes Service (AKS) as a cloud-native Kubernetes management solution.

Prior to 2021, Premera used a different service to collocate its data on premises and in a multi-cloud environment. However, this service struggled to maintain stability and did not scale smoothly. A team of more than 10 people had to scramble to maintain the environment and facilitate manual scaling. By migrating to AKS, the company built a secure, stable environment and saved both time and money. “We value our work with Microsoft and look forward to continued collaboration as we pursue our shared goals and objectives,” says Brajesh Katare, Chief Technology and Operations Officer at Premera. 

Delivering a stable environment using AKS

Premera has provided access to healthcare in Washington since 1933 and in Alaska since 1952. It has a number of ancillary systems that connect business partners and members to the information that they need. However, with extensive point-to-point connections, maintenance and upgrades became incredibly difficult. The organization had been working on a major project, DataHub, that promises to reduce this complexity and make data more securely accessible across various applications. But even after migrating its existing container service to Microsoft Azure in 2020, Premera was spending so much time on maintaining its Kubernetes setup that DataHub development stalled. “We had a lot of challenges with our Kubernetes service,” says Srinivas Rasappan, Senior Engineering Manager of DataHub at Premera. “We had invested millions of dollars in DataHub, but that part of our infrastructure was not stable.”

The organization needed a more efficient way to manage Kubernetes. The previous service couldn’t scale efficiently, and whenever Premera needed to upgrade its infrastructure, the entire system had to come down while the IT team completed cycles of revisions. “If we were to run DataHub and reduce our spending, we had to be better at delivering that data where and when it was needed,” says Rasappan. Premera had to commit a team of 10 resources to run the containerized infrastructure. Moreover, the organization was paying for both Azure and multiple additional licenses for services and software. In 2021, Premera decided to fully embrace cloud-native technologies and use AKS to achieve improved stability and scale automatically. 

Saving $700,000 on day one and reducing total cost of ownership by up to 60 percent

Premera quickly noted that AKS delivered significant cost savings. On day one of implementation, using AKS saved the organization $700,000 through more efficient resource allocation. “By using the node pool option in AKS, we reduced the cluster count from 20 to 4,” says Frank Locke, System Engineer V at Premera. The company has reduced its total cost of ownership by up to 60 percent with AKS.

Perhaps more importantly, Premera has seen markedly better reliability and stability with the new solution. Company teams are no longer worried that an alert will disrupt their workflow and force them to deal with an urgent piece of maintenance. “The number of tickets has gone down significantly, so developers are not burned out anymore,” says Rasappan. “We have more time to be productive elsewhere, and we can stay current with our member needs.” Now that 10 people no longer have to deal with Kubernetes management, the organization is better prepared to drive DataHub into the next stage of implementation. 

By avoiding faults and improving reliability, Premera can continue to keep its sensitive healthcare data secure. “With the implementation of AKS, we can auto-scale, minimize downtime, and manage our core offering better with minimal efforts,” says Narayanan Jaganathan, Vice President of Software and Service Engineering at Premera. “This is critical for our engineering teams to maintaining the quality of service that we deliver to both our members and providers.”

Implementing a zero-disruption migration with support from Microsoft

Premera had to plan its migration to AKS carefully to ensure that its members were not impacted by the move to a new solution. Because DataHub is such a large system, the team broke up the migration into four parts, moving incrementally to keep its systems running smoothly for its members. “The migration to AKS took place while we were hitting all our day-to-day deliverables,” says Scott Lucas, Senior Manager Enterprise Cloud at Premera. “I don’t think we had a business disruption related to the migration, which is a real testament to how successful the initiative was.”

Premera worked closely with Microsoft to identify and resolve challenges as it migrated to AKS. “Microsoft really stood out when it came to support,” says Rasappan. “The Microsoft team showed the interest in us to understand where we were struggling and offered the help that we needed to make this a success.” Premera employees were excited to work with AKS experts and build new skills that will help them move forward in their careers. Now the team is far more confident in its ability to innovate in a cloud-native environment. 

Migrating the “heart and soul” of the business to Azure 

With Premera’s DataHub infrastructure running smoothly, the organization is ready for an even bigger project. “We are going to migrate Premera’s flagship claims adjudication system, the heart and soul of our business, to Azure,” says Lucas.

Based on the success of this project, Premera is confident in the next stage of its cloud journey on Azure. “The main thing that Premera stands for is our members’ peace of mind,” says Rasappan. “We are doing this project on Azure to deliver the latest and greatest technology cost effectively, without disrupting our employees’ work–life balance. That is what we’re really proud of.”

“We value our work with Microsoft and look forward to continued collaboration as we pursue our shared goals and objectives.”

Brajesh Katare, Chief Technology and Operations Officer, Premera Blue Cross

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