Pittsburgh-based Highmark Health reported a more than $500 million in topline growth in 2018, reaching nearly $18.8 billion in revenues last year, according to its latest financial report.
However, net incomes declined by about the same figure during that window, dropping from just over $1 billion in 2017 to $570 million last year, according to the earnings report.
That's largely due to Highmark’s government insurance business—its Affordable Care Act, Medicare Advantage, Medicaid and small group plans—which decreased by $126 million from 2017, and commercial plans, which declined by $114 million. Membership was stable in 2018, Highmark said, with 4.5 million members across its plans in Pennsylvania alone.
Highmark also reported a more stable risk pool in its ACA plans, according to the report. Highmark said that it had 105,000 members enrolled in its ACA plans, 70% of which enrolled on the exchanges and 30% were off-exchange enrollees.
The major bright spot on Highmark’s earnings is its provider arm, Allegheny Health Network, which posted $39 million in operating revenue, an increase of $10 million from 2017. AHN also saw 11% boost in visits to ambulatory surgical centers in 2018.
“We believe it provides yet another proof of point that our strategy is working,” CEO David Holmberg said on a call with reporters on Tuesday.
Holmberg declined to comment directly on the politics of a recent Trump administration letter calling for a federal appeals court to affirm a lower ruling that struck down the ACA, but said that Highmark is prepared for “twists and turns” as the court case plays out.
“We’re prepared to play the hand we’ve been dealt,” Holmberg said.
Also on the call, Holmberg weighed in on the ongoing legal battle between Pennsylvania Attorney General Josh Shapiro and Highmark’s rival the University of Pittsburgh Medical Center. He reaffirmed Highmark’s support for the AG’s requested modifications to the consent decree between the two integrated health networks.
The spat between UPMC and Highmark has continued for the better part of the last decade and began in earnest when Highmark acquired what is now Allegheny Health System in 2011. The state sought to mitigate the dispute with a consent decree, but that agreement is set to expire this summer.
The attorney general’s lawsuit aligns with Highmark’s pro-consumer, pro-competition goals, Holmberg said.
“[Shapiro’s] actions last month affirm what we’ve been seeking for the last 6 years: a level playing field that fosters competition,” he said.