rss icon

Monday, 03 March 2014 15:42

Blue Cross Blue Shield reports lower earnings, health insurance loss for 2013

Written by 
Rate this item
(1 Vote)

Blue Cross Blue Shield of Michigan recorded net income of $265 million last year, driven largely by earnings from its subsidiaries.

The insurer’s bottom line, however, was smaller than it was in 2012 and it continued to lose money on health coverage for more than 4.45 million people.

The 2013 results across all of Blue Cross Blue Shield’s business segments compares with consolidated net income of $333 million in 2012.

President and CEO Dan Loepp attributed the overall results to a consolidated investment gain of $417 million and strong earnings by Blue Cross Blue Shield’s subsidiaries that more than offset health insurance losses. The results also came as the corporation was investing heavily to implement the federal Patient Protection and Affordable Care Act.

“It can’t be overstated: This is an incredibly challenging time in health care,” Loepp said. “This level of financial performance allows us to continue to transform our business, work to make our operations more efficient and customer-responsive, and make the changes necessary to compete in the new health insurance market created by the Affordable Care Act.

“It is gratifying to see Blue Cross continue to perform strongly — growing membership, maintaining the financial strength our members rely upon, and maximizing income from investments to take as much pressure as possible off our health insurance members.”

The bottom line for 2013 equated to a margin of 1 percent, which is within the range of 2 percent to negative 2 percent the corporation targets, said Paul Mozak, the insurer’s vice president for finance.

Mozak attributed the lower consolidated net income to lower earnings from investments that were affected in 2013 by higher interest rates. The $417 million in investment income for 2013 compares with $488 million in 2012. Blue Cross Blue Shield’s consolidated revenues totaled $21.3 billion in 2013, versus $20.9 billion in 2012, and include the health insurance business, the HMO subsidiary Blue Care Network, and the Accident Fund worker’s compensation and LifeSure long-term care insurers.

In the health insurance business, Blue Cross Blue Shield lost $85.9 million on revenues of $6.6 billion for 2013. The results included a net underwriting loss of $267.9 on health policies, primarily in the individual market and net investment earnings of $168.9 million.

That compares with a net loss of $2.5 million on revenues of $6.4 billion, net investment earnings of $252.8 million and a net underwriting loss of $220.9 million in 2012.

The 685,000-member Blue Care Network earned lower net income of $120.2 million in 2013, versus $167.2 million in 2012.

The insurer posted its third straight year of membership growth, adding 3,283 members. It now has more than 4.45 million members statewide.

Read 4087 times Last modified on Monday, 03 March 2014 17:11

Breaking News

January 2018
S M T W T F S
31 1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 31 1 2 3

Follow MiBiz