It looks like last year was a serious downer for the Blue Cross and Blue Shield plans, which lost a collective 40.9 percent in income for 2008, as compared with the previous year, struggling with realized losses, drops in investment income and declines in underwriting.
According to an A.M. Best analysis, the Blues saw a 6.6 percent growth in net premiums written, and the healthcare expense ratio improved 20 basis points to 85.9 percent. Also, there was a 30 basis point decline in sales, general and administrative expense ratio in 2008.
However, there was a 10.3 percent fall in capital and surplus, to $41.6 billion, hitting a level not seen since 2005. Also, underwriting earnings fell for the third year in a row. The drop was only 5.5 percent in 2008, a very modest hit compared with the 24.6 percent seen in 2007, but a drop nonetheless. Meanwhile, investment income plummeted 19 percent.
On top of all of this, an unrealized loss of $3.1 billion was reported for 2008, versus gains of $285.5 million in 2007.
To learn more about these results:
- read this Health Leader Media piece [1]
Links:
[1] http://healthplans.hcpro.com/content.cfm?content_id=237320&topic=WS_HLM2_HEP